Increase in Luxury Property Sales in Dubai; Listings Decline as Demand Outpaces Supply

In the third quarter of 2024, luxury real estate listings in Dubai saw a decline as supply continued to lag behind demand. A significant decrease in the supply of luxury properties along with an increase in buyer demand, especially in popular areas such as Palm Jumeirah, has caused prices to rise sharply. This report examines this trend in more detail and analyzes the factors affecting it.

Significant Decline in Transactions in Dubai's Luxury Areas

In the city’s prime districts, 400 transactions were recorded in Q3 2024, compared to 489 transactions in Q3 2023. This highlights a reduction in the number of homes available for sale across the city. When comparing Q3 2024 with the same period in 2023, there was a 52% decline in listings across four of the most desirable areas. This suggests that supply has not been able to keep pace with the speed at which properties are being sold.

Sharp Decline in $10 Million+ Property Listings

Knight Frank reports a significant drop in properties listed for over $10 million, from 3,316 listings in Q1-Q3 2023 to just 1,622 listings in the same period in 2024. However, 92 transactions valued at $10 million or more were signed in Q3 2024, an 8.2% increase compared to 85 deals in the previous quarter. From January to September 2024, a total of 282 home sales valued at over $10 million were registered, compared to 277 sales in the same period in 2023. These high-end transactions generated a total of $4.5 billion in revenue between January and September 2024. With 19 transactions totaling $344 million during Q3 2024, Palm Jumeirah remained Dubai’s hotspot for luxury sales. Dubai Silicon Oasis and Dubai Hills Estate ranked second and third, respectively.

Significant Growth in Sales at Palm Jebel Ali

According to Knight Frank data, nine transactions worth over $10 million took place in Palm Jebel Ali in Q3 2024, with a combined value of $97 million. This brought the total value of luxury sales for this palm-shaped island to $1.1 billion in 2024, accounting for 24.4% of Dubai’s total luxury home sales this year.

Popularity of Various Dubai Areas Among Luxury Buyers

Faisal Durrani, Partner and Head of Research for MENA at Knight Frank, notes, “Momentum at the top end of the market remains strong. Developers are racing to meet the demand for homes priced over $10 million, but the speed of ultra-luxury home sales continues to accelerate. Listings above $10 million have dropped by approximately 51% in the first nine months of 2024 compared to the same period last year.” Durrani added, “Despite this, the volume of sales in this unique segment has maintained its upward trajectory. This reflects the strength and persistence of demand for the city’s most expensive homes, with wealthy buyers continuing to absorb these properties at record rates. In fact, this is also reflected in the sales-to-listing ratio for homes over $10 million, which rose to 17.1% in 2024, compared to 10.7% in 2023.” In Q3 2024, the average price at which a home in one of Dubai’s luxury neighborhoods was sold reached $3.5 million. Palm Jumeirah (90.4%) once again claimed the highest share of luxury sales in Q3 2024, with 384 home sales. Jumeirah Islands (6.1%), Emirates Hills (2.2%), and Jumeirah Bay Island (1.4%) followed with smaller shares.

Adding New Islands to Dubai’s Luxury Real Estate Market

Petri Mannila, Partner and Head of Prime Residential for UAE at Knight Frank, remarked, “Palm Jumeirah remains the top choice for Dubai’s elite and global high-net-worth individuals, who continue to focus on what is likely the world’s most iconic island. And when you consider the fact that the average price per square foot for homes priced above $10 million here is $2,048, you can understand the value for money that Dubai offers to international buyers.” Mannila also pointed out, “With nearly no development sites remaining, Dubai’s latest islands—Palm Jebel Ali and Dubai Islands—are quickly emerging as the new hotspots for luxury homes, and will soon likely join our main watchlist alongside Tilal Al Ghaf, Jumeirah Golf Estates, Al Barari, and Bluewaters.”

Conclusion

The sharp rise in demand for luxury properties in Dubai has led to a noticeable drop in supply, pushing up property prices in dubai across the city. Prime areas like Palm Jumeirah remain at the heart of this booming market, and with limited available land for new developments, property prices in Dubai are expected to maintain their upward trend in the foreseeable future. International investors and domestic buyers alike are choosing Dubai as a prime destination for luxury real estate investment, further strengthening the city’s property market. Source: https://www.propertynews.ae