UAE - Prime property in Dubai is 20 to 80 per cent cheaper than in major cities such as Monaco, Hong Kong, New York, London, Geneva, Paris, Beijing and Tokyo, despite sharp price rises in the post-pandemic period.
According to Knight Frank's Wealth Report, US$1 million (Dh3.67 million) will buy 105 square metres in Dubai, compared to 17 square metres in Monaco, 21 square metres in Hong Kong, 33 square metres in New York, 34 square metres in London, 43 square metres in Paris, 60 square metres in Tokyo and 87 square metres in Melbourne.
In the list of 20 cities, Madrid, Mumbai, Cape Town and São Paulo have cheaper quality properties than the UAE.
These attractive prices have driven a significant influx of foreign investment into the emirate's luxury property sector since 2020, thanks to the successful handling of the pandemic and the introduction of new long-term visas boosting demand from foreign investors.
Ultra-luxury property asset prices saw unprecedented demand in the post-pandemic period, with the likes of Indian billionaire Mukesh Ambani purchasing the most expensive property ever built for Dh600 million. In addition, a number of other record-breaking deals were signed in 2022, including the most expensive flat ever sold in Dubai for Dh410 million. One property has been put up for sale for Dh800 million, which if sold would be the most expensive property ever.
With the emirate's aviation industry and overall economy recovering from the pandemic, Dubai has become the most connected city in the world in 2022, compared to the second most connected in the pre-pandemic period.
"I expect Dubai to remain the leading domestic market in the Gulf region during 2023. Dubai has seen phenomenal growth since the pandemic and its safe-haven status and position as a luxury second home hotspot, combined with the government's strong response to the pandemic, have all fuelled business confidence," said Henry Faun, partner and head of Knight Frank's Middle East private office.
Knight Frank expects the UAE to see a 13.5% increase in prime property prices in 2023, the highest of any major city in the world, as high demand over the past few years has led to a shortage of supply at the top end of the market. While most other cities are likely to see moderate single-digit growth.
"Dubai leads the forecast, with gold prices expected to climb by 13.5% in 2023, with its relative affordability, expanding global appeal and accessibility being key to the appeal," it said.
For the second consecutive year in 2022, Dubai leads the way in terms of prime property price growth, up 44 per cent across the 100 markets tracked by Knight Frank.
"While the UK, as well as the EU and the US, still attract a significant number of globally liberal and affluent residents, it is undeniable that Singapore and Dubai are emerging as key wealth centres. Dubai has developed a very pragmatic approach to attracting wealthy residents - and has worked hard to correct an area of perceived weakness, namely length of stay. Visa options used to be mostly short-term and work-related, but with the introduction of the Golden Visa scheme, long-term residency is now a possibility," says the Wealth Report.
Arash Jalili, founder and CEO of Unique Properties, said the resilience of the UAE after the pandemic was well reflected in the country's real estate sector.
"Prices have remained strong, especially in the luxury market, sometimes at 50 per cent of asking prices. High net worth individuals are migrating to the UAE from around the world, fuelling this growth with large-scale purchases. We expect this upward trajectory to continue for the foreseeable future as quality real estate offers the highest returns on capital and Dubai continues to be a global destination for residents and investors alike," he added.
