Dubai - a surge of demand presents investors with opportunities

In August, Dubai's real estate market experienced a remarkable surge, presenting an exciting opportunity for investors like myself. Sales soared by an impressive 43 per cent, reaching a substantial $9.1 billion in total transactions.

Remarkably, ten specific regions within Dubai played a pivotal role, contributing to 53 per cent of the total number of off-plan sales transactions and a staggering 65.3 per cent of the total sales value. Notably, wealthy international families displayed a keen interest in villas with four bedrooms or more, underscoring the attractiveness of luxury properties in Dubai.

Recent market insights highlight that these ten key regions also accounted for 40 per cent of all transactions, with iconic areas such as the Burj Khalifa and Palm Jumeirah emerging as the most sought-after locales, making up nearly 30 per cent of all property transactions.

The August Property Search report by Property Finder revealed another noteworthy trend – a substantial increase in real estate transactions, totalling 11,818, marking a 25 per cent growth compared to August 2022. 

Furthermore, the luxury real estate segment in Dubai experienced remarkable year-on-year growth of 63 per cent, with transaction volumes rising from 4,189 in August 2022 to an impressive 6,837 during the same period this year.

Intriguingly, the value of sales for properties under construction exhibited remarkable growth, surging by approximately 103 per cent from $2.2 billion in August 2022 to an astounding $4.6 billion in August 2023. A significant portion of these off-plan purchases was attributed to high net-worth individuals from overseas, further underlining the global appeal of Dubai's real estate market.

Analysing the property search data for August 2023, it becomes evident that 63.9 per cent of tenants have a preference for furnished apartments, while 34.5 per cent specifically request unfurnished units. One-bedroom units remain a popular choice, accounting for 36 per cent of renters, closely followed by two-bedroom units at 31 per cent. Studio units, favoured by skilled workers and international travellers, make up 21 per cent of the market.

Moreover, more significant properties are increasingly catching the eye of investors and wealthy families relocating to Dubai. Three-bedroom villas and townhouses are the preferred choices, with four-bedroom and larger units capturing a substantial share of interest at 43 and 35 per cent respectively.

For international high-net-worth individuals (HNWIs) considering investments in Dubai's luxury real estate market, it's crucial to monitor currency exchange rates during transaction processes to maximise returns and mitigate risks.

Over the past decade, the UAE, particularly Dubai and Abu Dhabi, has firmly established itself as a global hub for luxury living, making it an enticing prospect for global investors.

Dubai's real estate market is currently a goldmine for astute investors, offering a plethora of opportunities and impressive growth prospects. The remarkable surge in sales, the increasing popularity of luxury properties, and the sustained interest from international buyers and tenants all underscore the city's allure as a global real estate hotspot.

As investors, it's essential to stay attuned to market trends, especially regarding currency exchange rates, which can significantly impact the returns on our investments. Given the city's consistent growth trajectory and attractiveness to global high-net-worth individuals, Dubai remains a promising destination for real estate ventures.

Over the past decade, Dubai and the wider UAE have undergone a remarkable transformation, evolving into thriving hubs for luxury living, business, and innovation. This transformation has not only bolstered the appeal of the real estate market but also solidified the region's status on the world stage.

For those international high-net-worth individuals considering Dubai as their next destination, ensuring secure modes of money transfer during property transactions is a prudent step. This approach safeguards your investment and ensures a seamless process when acquiring primary or secondary residences in this dynamic and vibrant city.

In summary, Dubai's real estate market is witnessing an exciting era of growth and international interest. As real estate investors, staying informed, leveraging market insights, and utilising prudent financial strategies are essential to capitalise on the abundant opportunities this thriving market has to offer. Dubai's ascent as a global luxury destination shows no signs of slowing down, making it an appealing choice for both seasoned and emerging real estate investors alike.

• Tej Kohli is a real estate investor focused on properties in premium micro-locations which transcend cycles and transacting as the Zibel Real Estate portfolio *