As 2016 fades out I cannot help but think the world is a somewhat more insane place than it was in January 2016 but as Sun-Tzu so eloquently said: “In the midst of chaos, there is also opportunity”.
In order to understand the Dubai property market one must have a global perspective. Dubai is recognised as a true international hub, with investors from the four corners of the globe. According to data from the Dubai Land Department, international buyers accounted for 75 percent of luxury real estate investment in the first two quarters of 2016. In light of this, the microcosm that is the Dubai luxury property market is shaped by worldwide geopolitical events. Brexit, President-elect Trump and low oil prices have all affected the luxury market here, but not as negatively as one might first imagine.
Dubai in 2017 will, I believe, benefit from the political uncertainty in the West. The election of Mr. Trump and his anti-Islamic sentiment already shown signs of dissuading Middle Eastern investors from buying properties in places like New York, Miami and Los Angeles. Middle Eastern based investors will, I predict, look to invest in their own region.
2017 will see Dubai continue to position itself as a true safe haven for UHNW individuals. An increase in government and banking regulations serve to confirm the city’s intention of good governance and proper regulation. With a favourable tax regime, coupled with residency rights and a sense of safety and security, means in 2017 Dubai will continue to be an aspirational location for UHNW individuals looking for luxury properties.
AdvertisementAt this time of year, I am fondly reminded of the immortal words of the English Poet Tennyson: “Hope smiles from the threshold of the year to come, whispering 'it will be happier’”. I am quite optimistic that these wise words can be applied to the Dubai luxury property market in 2017.
Jason Hayes is managing director of real estate firm Luxhabitat.
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