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In the first five months of 2024, 948 transactions were closed in Dubai's luxury real estate market, each valued at Dh15 million (about $4 million) or more, according to a recent report.

The report by real estate firm Betterhomes noted that these high-value deals were concentrated in several key areas, including The Palm Jumeirah, Mohammed bin Rashid City, Dubai Canal, Tilal Al Ghaf and Dubai Hills. These areas not only topped the list in terms of the number of luxury property sales, but also contributed significantly to the total value of transactions during the period.

Among them was the MAG Ritz-Carlton Residences in Dubai Medical City, which sold for Dh165.6 million, the highest-priced primary residential sale in the emirate so far this year. This was closely followed by Meraas' Bvlgari Lighthouse in Jumeirah Bay, which sold for Dh140.5 million, and AHS Properties' Fendi Casa Canal in Dubai Canal, which sold for Dh140 million.

Louis Harding, Managing Director of Betterhomes, said, "The truly independent luxury real estate market is a relatively new phenomenon in Dubai and only really started to gain significant momentum after the outbreak, thanks in part to the government's proactive response to the epidemic. "

Dubai's real estate market is expected to maintain steady growth as the population grows and demand rises," he added. This trend is attributed to Dubai's attractiveness as a global live and work destination, the stability of governance demonstrated by the government during the international elections, and the relative scarcity of high-end residential supply. In addition, the various long-term residency programs introduced in Dubai, coupled with the relative affordability of Dubai's house prices compared to other major cities, will further boost the market."

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The UAE real estate market has boomed in recent years with the introduction of government residency permits for retirees and remote workers as well as the expansion of the 10-year golden visa program. Diversification efforts have also supported the overall growth of the UAE economy, further boosting the real estate market.

Dubai's luxury residential market hit an all-time high last year, with sales of luxury properties above $10 million nearly doubling to $7.6 billion, outperforming London and New York, Knight Frank said in a report earlier this year. According to Knight Frank, Dubai's house prices of $10 million and above rose 26 percent last year, one of the fastest increases in the world, as overseas buyers continued to demand luxury homes in the city.

The surge in global wealth creation has had a significant impact on the Dubai real estate market. According to Betterhomes, Dubai has become the destination of choice as affluent individuals seek to diversify and secure their assets amid geopolitical turmoil.

Over the years, the UAE has welcomed 99,000 millionaires and Dubai alone now has more than 72,000 millionaires, according to the World's Richest Cities 2024 report by Henley & Partners. The city now has the highest concentration of billionaires in the Middle East, with the total assets of the rich exceeding Dh3.7 trillion.

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The report predicts that by 2024, around 72,500 millionaires, 212 multimillionaires and 15 billionaires will move to Dubai. The report says: "Traditionally, cities such as London, New York, Singapore and Hong Kong have been the top choices for the wealthy. However, the worsening geopolitical situation, significant tax shifts, policy changes and tightening supply that has led to price increases have prompted the wealthy to look to Dubai as a new place to live."

"The city offers excellent value for money, with the same investment delivering a higher standard of luxury compared to other metropolitan areas." In the first quarter of 2024, the average home price per square foot was $824 in London, $808 in New York, $765 in Singapore, $663 in Los Angeles, $659 in Toronto, and $352 in Dubai.

The report notes that while these cities have experienced immigration-driven growth over the past few years, they also face significant challenges that hinder their ability to deliver value for money in the real estate market. A major issue is the severe shortage of housing to meet high demand. The report also said that the housing shortage has led to higher prices and buyers are finding it difficult to find properties with good investment value.

"In contrast, Dubai is proactively addressing the supply challenge by adding more high-end homes. More than 50 luxury projects are currently under construction, with each apartment starting at Dh15 million or more." The report shows that Dubai also saw a significant increase in luxury property rental transactions between January and May this year, with 270 contracts signed for properties with annual rents of Dh1 million or more. Locations dominating this high-end market are The Palm Jumeirah, Mohammed bin Rashid City and Dubai Hills.

The Betterhomes report also found that the surge in tourists and transit visitors has also increased demand for short-term rental properties, particularly luxury vacation homes. The report added that many landlords are now considering revamping their properties, especially those with larger layouts and located on the beachfront, to meet the growing demand.