Real estate in Dubai: the most sought-after locations and the most expensive properties

It has been almost 20 years since foreigners began buying real estate in Dubai. The transaction procedure has changed and has become convenient, fast, and transparent.

Content:

• Foreigners choose freehold in Dubai
• Overall results of 2022
• Luxury housing sales in Dubai
• Business Bay is the best-selling location of the year
• The most sought-after off-plan projects
• Address Hillcrest in Dubai Hills offers the most expensive real estate
• Forecasts for 2023
• The Palm Jumeirah is a leader in the luxury real estate market

Foreigners choose freehold in Dubai

To buy apartments in Dubai and make deals, including selling and bequeathing a property, a foreign buyer must choose a freehold area. Leasehold real estate has restrictions for non-residents in the UAE, thereby making it less popular with ex-pats. Many developers have been paying special attention to freeholds in recent years and are implementing their projects, including the elite ones, in this category.

What is the most sought-after and elite real estate that Dubai offers to foreign nationals in freehold?

Overall results of 2022

The past year has been successful for the sales of ready-to-move-in real estate and development projects in Dubai. E.g., the total number of real estate transactions almost reached 100,000, 60% more than the same figure in 2021. Apartment sales were the most sought-after deals.

Here are the data for all the types of real estate for 2022:

The total amount of transactions was 265 billion AED, 76% higher than the 2021 result.

Luxury housing sales in Dubai

Over the past year or two, there has not only been a significant increase in the sales of real estate in Dubai, but also an increased interest in luxury apartments and villas. Until 2020 the sales schedule in this segment might have been a wave with fluctuations of 4 to 6 billion AED annually, however, in 2021, it went up sharply:

As you can see, the volume of transactions doubled in the last year alone, with an increase in buyers wanting to invest in elite off-plan properties.

Business Bay is the best-selling location of the year

Business Bay was the most popular area in the overall housing sales in 2022. This once again confirmed that a location close to the city centre, a well-developed infrastructure, and a variety of real estate types is the key to the success of a location in Dubai.

The coastal quarter of Dubai Marina, the winner of the previous years, ranked second. The well-developed Jumeirah Village Circle ranked third.

When only looking at the sales of off-plan properties, the second most popular area among buyers was Damac Lagoons, placing the Dubai Marina and the Jumeirah Village Circle in third and fourth place. Moreover, at the end of the year, it ranked first in terms of total transactions – 11.7 billion AED.

The most sought-after off-plan projects

As the above table indicates, half or more of the transactions in the most popular places are off-plan properties. This shows the growing desire of investors for long-term investments in sought-after areas. The overall figures confirm this trend: investments in off-plan properties increased from AED 51 billion in 2021 to AED 125 billion in 2022 (almost 2.5 times) and overtook the number of investments in finished real estate. They also showed growth, but far more modestly – from AED 71 to 90 billion.

Address Hillcrest in Dubai Hills offers the most expensive real estate

The largest volume of sales in 2022 was demonstrated by the famous area of luxury real estate – the artificial island of Palm Jumeirah. With a total sales volume of AED 4.5 billion, there were 124 transactions during the year. The average purchase price was AED 22.8 million.

However, according to the average property price, Address Hillcrest in Dubai Hills overtook this location by the end of the year. With a total of 112 transactions of AED 2.7 billion, the average cost of a villa sold here was AED 23.8 million. And small wonder because Address Hillcrest is an off-plan project. Villas in Dubai in this area cost AED 20-25 million. Local offers are quite similar and expensive. The Palm Jumeirah district (more precisely, its large project) ranks third. Private apartments at the Six Senses Residences hotel brought in AED 2.1 billion from 69 sales with an average price of AED 22.1 million. Here is the same data in the table for easy comparison:

As a result, the first 3 locations account for a quarter of all luxury real estate sales in Dubai in 2022, both in the number of properties and the total cost. This once again confirms the "queue effect" – new investors are looking for sought-after communities, but the little-known locations or those with a small number of real estate projects remain unclaimed.

Forecasts for 2023

Most likely, the record-breaking locations of 2022 will show good results in 2023. Business Bay and the Dubai Marina have been consistently in the top three for many years in both the number of transactions and their total amount. The Jumeirah Village Circle also ranks third or fourth, sometimes giving way to new projects with a wide variety of offers. There are several factors uniting these areas, despite all the differences:

• The development has been ongoing for many years, and the area has enough space for the large new projects.
• There are various residential communities with rich infrastructure.
• The area is close to one of Dubai’s two most popular destinations – Downtown Dubai or Palm Jumeirah.

The Palm Jumeirah is a leader in the luxury real estate market

If we consider luxury real estate in Dubai by the various offers, there’s no equal to the Palm Jumeirah district, which continues to create new clusters of premium properties. Nevertheless, in 2022 and 2023, new luxury apartments and villas were put up for sale, occupying a large share of the housing market and attracting the attention of investors with wide opportunities for investing in premium real estate in Dubai.