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Dubai continues to see a huge influx of property buyers in search of ultra-luxury homes, especially penthouses with price tags of upwards of $10 million to $27 million, according to industry experts.
These buyers are mostly ultra-high-net-worth individuals (UHNWIs) from a number of markets overseas, including Europe and countries in the so-called Commonwealth of Independent States (CIS), which include Russia and Ukraine, among other states, according to Petri Mannila, sales director of Penthouse.ae.
Demand for properties in Dubai started picking up since COVID-19 restrictions eased in late 2020. By the first quarter of 2021, sales of premium properties skyrocketed by 230%, compared to the same period in 2020, while prices in sought-after locations also surged by up to 40%, according to Property Finder.
Over the past several months, Penthouse.ae said it has seen buyers snapping up upscale properties that cost more than 40 million UAE dirhams.
“We are seeing a huge influx of ultra-high net worth investors and buyers from Europe and the CIS in the last six to 12 months who are looking for ready-to-move-in homes and driving up demand for these uber-luxury units,” said Mannila.
“We are currently listing ten penthouses ranging from 100 million UAE dirhams up to 400 million UAE dirhams in Dubai, some of them ready-to-move-in and a few are to be handed over in the next year or two.”
It recently sold a penthouse for 80.5 million UAE dirhams and has closed many deals on ultra-luxury properties including a property on Jumeirah Bay Island worth 154 million UAE dirhams, and two other units on the Palm Jumeirah costing 82 million UAE dirhams and 62.9 million UAE dirhams each.
Other closed deals include a luxury home worth 50 million UAE dirhams in BV Residences, Island 2; a unit in Royal Atlantis Resort & Residences, Palm Jumeirah worth 43 million UAE dirhams; another unit in Elysian Mansions, Tilal Al Gaf (41 million UAE dirhams), as well as in the Address Jumeirah Resort & Spa, JBR (40 million UAE dirhams) and a full floor in the Le Pont Building in Port de La Mer (42 million UAE dirhams).
Most expensive penthouse
The real estate platform, a luxury division of real estate agency Metropolitan Premium Properties, has also just listed one of Dubai’s most expensive ready-to-move-in penthouses for 120 million UAE dirhams ($36 million).
The 10,000-square-foot luxury home is in the Jumeirah Gate Tower in Jumeirah Beach Residence (JBR) that offers 360-degree views of the Dubai skyline and popular landmarks like Ain Dubai, Burj Al Arab and Palm Jumeirah.
Dubai’s real estate market is seeing a huge volume of property transactions, as the local government’s handling of the COVID-19 pandemic and the emirate’s new visa policies attract interest from wealthy buyers. Just last week, over 2,000 flats and villas were sold for 4.61 billion UAE dirhams, according to the Dubai Land Department (DLD).
Part of the emirate’s appeal is that foreign buyers can own a piece of luxury real estate in Dubai for less than the cost in other global cities like London or New York.
“When you compare Dubai with other cities such as London, New York, Hong Kong, the price [here] is still very cheap. We are still not expensive, even though we’ve grown 70% in the past year in the high-end luxury,” said Abbas Sajwani, CEO and founder of AHS Properties, which specializes in luxury penthouses and villas that cost around $20 million.
Besides, Sajwani said Dubai offers many other incentives to property buyers and these include the lack of taxes on capital gains from property and low transaction fees. The city also offers “great infrastructure” and the “nicest lifestyle” for residents.
“The city has also advanced… Investors see that what their money buys them has value and they see that there’s still a big upside on property in Dubai,” Sajwani told Zawya in an earlier interview.
According to Knight Frank, Dubai’s prime values are indeed being fuelled by the emirate’s safe-haven status, a diverse range of foreign wealthy buyers in search of second homes, combined with the government’s “world-leading response to the pandemic, which has spurred business confidence”.
“Adding to the city’s appeal is its relative ‘affordability’, with prime homes transacting for around $800 per square foot, making Dubai one of the most ‘affordable’ luxury residential markets in the world,” said Faisal Durrani, partner – head of Middle East Research at Knight Frank.
(Reporting by Cleofe Maceda; editing by Mily Chakrabarty)
