Knight Frank expects Dubai home prices to rise further next year, after already increasing by 20% in 2024, indicating an extension of the ongoing recovery that began after the pandemic, according to Bloomberg. In a recent report, the real estate broker said that home values are expected to rise by 8% in Dubai’s overall market next year, while average prices for luxury properties will jump by 5%.
The price hike has already created a lot of millionaires, with the report estimating that at least 95,000 of the 530,000 homes in Dubai sold since 2002 are now worth more than $1 million.
“These days, the $1 million house is actually the average price of a single-family home, which highlights how much values have increased over the past four and a half years,” said Faisal Durrani, head of Middle East research at Knight Frank.
Knight Frank noted that demand for Dubai property is booming as the government’s exemplary handling of the pandemic and its attractive visa policies attract scores of foreign buyers. The emirate’s luxury property market, including waterfront villas on artificial islands, has also benefited from an influx of wealthy investors from around the world.
Dubai has seen dramatic boom-and-bust cycles in the past, but analysts see less risk this time because of rules that have boosted down payments and because most buyers are end users, Durrani added.
“The drivers are very different in this cycle, and there is nothing in the data to suggest that we are approaching a recession or anything like that,” he said.
Standard level
According to the report, sales activity reached a record level, with the volume of transactions in the first three quarters of this year exceeding the total recorded for the whole of 2023. Real estate sales for the third quarter achieved a record of 116.8 billion dirhams ($31.7 billion). Knight Frank estimates that developers will build 300,000 homes by the end of 2029 as they race to capitalise on growing demand