Dubai has established itself as a global destination for the wealthy and the super-rich from around the world. While conflicts are ravaging the economies of a number of countries, business owners are getting richer in Dubai. The Associated Press reported that Dubai is consolidating its position day after day as a “safe haven in the Middle East.”
Dubai has established itself as a global destination for the wealthy and super-rich from around the world. While conflicts are ravaging the economies of a number of Middle Eastern countries, business owners are getting richer in Dubai, as the emirate’s economy continues to perform strongly, supported by various sectors.
The Associated Press considered, in a report it published on the economic situation in the Middle East, that Dubai is consolidating its position day after day as a “safe haven in the Middle East.”
“Dubai is in a very unique position, with the wealthy continuing to flock to Dubai because of its unique assets, promising opportunities, stable climate, business-friendly legislative environment and infrastructure,” Zhan Goshinki, chief operating officer of property consultancy Property Monitor, told The Associated Press.
He added that Dubai is the safest destination in the region due to its assets and stability, and when the wealthy are very concerned about the turmoil around the region and the world, the city offers stability, low taxes, an encouraging visa system, and benefits and incentives that ensure the prosperity of projects and help in the expansion and growth of businesses.
Zhan Gushinki pointed out that demand is increasing in the Dubai real estate market, which has pushed luxury properties to record valuations, noting that Emaar Properties announced that its development business achieved sales worth $8.1 billion during the first half of the year, up from $5.2 billion during the same period last year.
Luxury villas
Across the city, valuations of luxury villas in Dubai hit a new record high, rising by around 38% in Q2 2024 compared to last year, supported by strong investor demand and an influx of wealthy individuals from around the world, given the sector’s attractiveness and ability to generate returns that are among the highest in the world.
According to property consultancy ValuStrat, the average price of a villa has surpassed $2.7 million for the first time in a decade. Next up are luxury apartment prices, with locations on Palm Jumeirah already surpassing their 2014 peak.
Tariq Shah, head of sales at Pat & Co., a luxury real estate brokerage, said demand from his clients seeking to buy has skyrocketed. “The demand for luxury is much higher than expected,” Shah told The Associated Press.
Meanwhile, Dubai International Airport, the world’s busiest for international travel, saw a record 44.9 million passengers in the first half of this year. Dubai is planning to upgrade operations at Al Maktoum International Airport, with an investment of around $35 billion planned for the project over the next decade.
Record
“We are on track for the rest of the year to see 91.8 million passengers through Dubai International, another record for us,” Dubai Airports CEO Paul Griffiths told The Associated Press. About 9.3 million tourists visited Dubai during the first half of the year, surpassing pre-pandemic levels, according to research from Emirates NBD.
Dubai’s population has grown from 3.2 million in 2018 to about 3.7 million this year, with an additional 1.1 million living temporarily in the city or commuting to work every day. Dubai aims to increase the population to 5.8 million by 2040.
Meet the demand
“From 2025 and 2026, there will be a huge new supply of new units that started construction in 2021 and this supply meets the growing demand,” Tatiana Liskova, an analyst at S&P Global, told The Associated Press.
According to the official Emirates News Agency (WAM), developers completed more than 6,000 residential units in the first half of the year, and are expected to finish another 20,000 by the end of the year. “These are big numbers, but they are being absorbed. People are buying them,” said Goschinki of Property Monitor.
For a detailed perspective on the property market, visit: Dubai - VPI Residential Capital Values - July 2024
