Luxury New Builds In Dubai Cannot Meet Heated Demand In 2022
The latest market data shared by Knight Frank suggests that heated demand from international investors results in scarce luxury property stock in Dubai, pushing home values to new records.
In general, experts anticipate a 15% rise in luxury property prices in Dubai because of insufficient supply. But why can real estate developers in Dubai not meet the heated demand?
Core Reasons Behind Insufficient Stock
The main reason is simple: property developers in Dubai cannot keep up with record demand levels, especially driven by international investment into the real estate market in Dubai. As the property market slightly lagged during the pandemic, the current heated demand is challenging for developers to meet.
Moreover, the global economic uncertainty only further drives the desire of people to invest in Dubai's reliable and growing real estate market as a way to secure funds.
2022 Is Breaking Records
The current year has set several new records for the property market in Dubai, including luxury properties. According to the market, H1 2022 saw 82 home deals worth more than $10m. By comparison, total figures for 2021 as a whole hit just 93 transactions.
UK, India, and Gulf countries dominate the international property market in Dubai, with the US, Austria, and Switzerland following closely. Interestingly, most foreign investors prefer luxury new builds in Dubai, attracted by rental growth and housing capitalization.
Current Real Estate Trends In Dubai In 2022
The most dominant trend is the rising property prices in Dubai, including prime new builds. Moreover, experts anticipate values for luxury homes to rise by 15% in 2022 and up to 7% for other market sectors.
Prices for new villas in Palm Jumeirah increased by more than 50% year-on-year, which is a striking figure. District 1 and Dubai Hills also enjoyed major uplifts in residential property prices by more than 30%.
Currently, prices are rising slower than before but are not stopping. As a result, it is too early to talk about market stabilization. As long as there is heated demand, home values n Dubai will rise.
