Dubai shows strong luxury price growth in global market trends for 2023

04.03.2024 - 08:09 / traveldailynews.com / Knight Frank / Vicky Karantzavelou

Luxury prices around the world increased by an average of 3.1% in 2023, with Manila (26%) leading the rankings and Dubai (15.9%*) in the second spot.

DUBAI – According to The Wealth Report, Knight Frank’s flagship research report – prime residential prices showed significant strength in 2023. Of the 100 markets tracked in Knight Frank’s Prime International Residential Index (PIRI), 80 recorded flat or positive annual price growth. Luxury prices increased by an average of 3.1% in 2023, with Manila (26%) leading the rankings and Dubai (15.9%*) in the second spot. The Bahamas (15%) comes in third place with the Algarve and Cape Town (both 12.3%) completing the top five.

Prime residential values in Dubai, which encompass the neighbourhoods of the Palm Jumeirah, Emirates Hills and Jumeirah Bay Island, have experienced record growth during 2023, albeit this has been from a low base, Knight Frank says. Furthermore, Knight Frank’s 2024 global prime residential markets forecast positions Dubai in third place at 5%. This comes hot on the heels of an estimated 16% rise in prime residential prices in 2023 and building on the 44.4% rise registered in 2022.

Faisal Durrani, Partner and Head of Research, MENA says: “The total number of prime homes available for sale declined by 38.5% in Dubai during 2023, echoing the 52% decrease in sales inventory in Dubai’s Burj Khalifa over the same period. Owners are clearly deciding to hold on to their homes for longer, with inventory levels falling sharply, signalling the longer-term residency mindset now bedding in amongst the increasingly dominant buy-to-hold purchasers. Unsurprisingly, this behaviour has helped to sustain price growth in the emirate’s prime market, which registered the second fastest rate of growth globally in 2023 at 15.9%*”

“The accolades for Dubai’s prime market are piled high following the city’s record breaking 431 US$ 10 million+ home sales, including an all-time high of 56 properties trading for over US$ 25 million last year. Despite the record-breaking sales of luxury homes, Dubai ranks towards the bottom end of the most expensive prime markets globally. Indeed, in our global tracker of 15 prime residential markets around the world, US$ 1 million secures 979 square feet of residential space, three-times more than London, New York, or Singapore and about 806 square feet more than first-placed Monaco, where US$ 1 million buys around 172 square feet of space. Dubai remains one of the most affordable luxury markets in the world, which only adds to its appeal among the international elite who dominate the upper echelons of the market”.

Will McKintosh, Regional Partner and Head of Prime Residential, MENA says: “Dubai’s residential market is no longer