(MENAFN- Khaleej Times) Published: Wed 29 Mar 2023, 4:40 PM Dubai's ultra-prime branded residential market recorded exponential growth in 2022 with over Dh25 billion in sales, representing an 80 per cent year-on-year increase while setting a new sales record for the market.
The latest analysis by global property consultancy Knight Frank shows that Dubai's branded residential market continues to deepen with 61 per cent of off-plan apartment sales in the city linked to branded residential developments during 2022.
The branded residential sector led by operators such as Ritz Carlton, Bvlgari, Dorchester Collection, and the Four Seasons is all set to capitalise on the growing demand for high-end homes in Dubai. Buyers are seeking out the best buildings with high levels of service and amenities and the stability and security offered by leading, recognised brands managing the residences, realty experts said.
Going forward, the luxury and branded homes segment in Dubai will continue to record phenomenal growth as the city is witnessing an influx of high net worth individuals (HNWIs) wealth evidenced by the sharp rise in high ticket price transactions, in particular by Russians since the beginning of the Ukrainian war.
Knight Frank predicts that the luxury property market will grow further in 2023 by 13.5 per cent. This is a record in itself, as no other global property market is expected to touch the double-digit mark this year.
In 2022, prime property segment saw a 41 per cent increase in secondary market transactions and a 97 per cent rise in off-plan transactions for properties priced at Dh10 million and above. Furthermore, 2022 saw the highest-ever number of transactions recorded above the Dh100 million mark - total of 16 transactions recorded in 2022 compared to only five transactions in the whole of 2021.
Realty experts expect demand for the prime and ultra-prime market to continue to flourish in Dubai on the back of strong demand driven by visa reforms, the city's positioning as a tax haven and a global destination for the wealthy.
Faisal Durrani, partner and head of Middle East Research at Knight Frank, said Business Bay has been one of the best-performing apartment submarkets in Dubai over the last two years, with a 25 per cent rise in average transacted prices.“Excellent transport infrastructure, including easy access to the city's key business hub at the DIFC has resulted in Business Bay experiencing stronger price rises than Dubai Marina, for instance, where values are up 9.0 per cent in the last two years.”
Business Bay is also 35 per cent cheaper than Downtown and is attracting the attention of new-to-Dubai branded residential operators, including the likes of the Ritz Carlton, and Mama Shelter and Mr. C, albeit the latter are further up the canal, Durrani said.
As per Knight Frank's research, with 219 home sales at over $10 million, Dubai emerged as the 4th busiest ultra-prime market last year behind New York (244), Los Angeles (225), and London (223), it added.
Dubai racked up 219 sales of properties worth $10 million or more last year, according to Knight Frank. By comparison, New York registered 244 deals worth $10 million or more, Los Angeles, 225 transactions, and London, 223. Dubai was also the fifth most active city for sales worth $25 million and above with 26 transactions.
The branded residences industry across the globe has swelled by 230 per cent over the past decade, according to Savills research in September.
There were 580 branded residence schemes worldwide at the time and 900 more planned to complete by 2026, the report said.
The UAE – which was expected to attract the world's largest net inflow of high net worth individuals last year – had 30 completed schemes and almost 50 in the pipeline as more brands enter the market to capitalise on soaring demand for luxury homes.