Mind-bogglingly expensive: real estate in Dubai approaches the indicator of 100 mln $ per deal

Mind-bogglingly expensive: real estate in Dubai approaches the indicator of 100 mln $ per deal

31.05.2022

Mind-bogglingly expensive: real estate in Dubai approaches the indicator of 100 mln $ per deal

For the last several years, Jumeirah Bay became the matriarch of the largest developer and realtor deals. It is conditioned by several reasons, in particular, peculiarities of Dubai real estate market.
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In this, prices for premium class buildings and villas were increased to record values: some objects are announced at the price of 300-350 mln AED. For example, Alpago Real Estate declared that the future villa objects in Palma District will be announced at the average price of 210 mln AED.

Moreover, Jumeirah announced the luxury house price — 350 mln AED, from fäm Properties developer. Such offers raise the market bar even higher. Is the market of Dubai really ready for objects that will cost that colossal money?

Whatever the potential market offers are, the record-breaking deal in Dubai (so far) is a large villa with 10 bedrooms by the sea for 280 mln AED. The mansion is located in The Palm Jumeirah and has the area of 33 ths sq. feet. This deal allowed the Dubai real estate market approaching the desirable indicators in the Elite housing segment.

Since March 2022, many developers and investors started investing in real estate, that has not been scheduled before. Experts substantiate such behavior by the increasing demand for real estate from the target audience side. In connection with the present situation, the increased flow of customers from the CIS and RF may cause many-fold increase of rent cost and finished objects. In addition, experts expect deals to become extremely fast: the assessment is given for a 1-week term.

For example, according to some agents in Dubai, instead of the expected “winter” for demand, the number of executed deals for elite real estate grows continually. Moreover, with reference to the same sources, numerous agreements are at the last stage of performance, and these deals are made by purchase for cash.

Adjustment of prices for real estate

Surprisingly, prices for some real estate objects in Dubai reach 300 mln AED, which proves the customer demand increase. Annual demand does not align with the world situation in any way but, at the same time, it is its consequence. The investors are interested in the increased attention to Dubai real estate market: it coped with the post-COVID period excellently, and reforms on obtaining residence visa only increased the flow. Moreover, the conflict in Ukraine increased the number of potential real estate buyers.

Many experts compare crisis management in Dubai and in other cities and countries, and make decisions based on this. “Dubai was excellently prepared for such course of events, so it’s unreasonable to consider it just a chance circumstance. That is not luck but professionalism of all the market players.”

Extensional and comprehensive development

New ideas, projects and objects are launched with incredible speed: for example, realization of two new towers in Al Safa district starts right now.

Dubai is only one of representatives of fast-growing markets. Actual housing on Saadiyat Island was also launched in Abu Dhabi. Price of apartments in such object reaches 1 mln AED.

In Sharjah, different communities like Masaar become more popular; it follows the natural design of Arada, and contains many attributes of high class life. The certain limits for the housing level are current because houses should be “elite” enough, and with rich vegetation.

Ubiquitous housing does not only relate to premium class housing. In other areas, Danube Properties and Samana start selling objects for the audience segment closer to the middle.

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