Dubai again caught world attention by launching ultra-luxurious mansions and penthouses with mind-boggling price tags. Some of the opulent homes are over $100 million, conceived to entice the world’s richest people and make Dubai a global business and recreational destination.
These grand mansions, located in Dubai’s most exclusive beachfront areas, offer unparalleled amenities such as private cinemas, spas, dedicated elevators, and even floating swimming pools. Designers and developers use the finest materials and cutting-edge technologies to turn their clients’ dreams into reality.
For instance, humongous glass walls are delivered from thousands of kilometers to provide breathtaking ocean sceneries. In another scheme, a penthouse has its own lobby and elevator connecting two towers. There is even one floating pool floor made by a developer that may lift up to join seamlessly with garden tiles to create VIP-themed parties.
Despite a slowdown in Dubai’s booming real estate market after a steep surge since 2021, developers continue to build new luxury homes in the city’s most expensive coastal districts.
Mark Phoenix, CEO of Sankari Properties, which is developing a $1 billion ultra-luxury tower, stated:
“The high-end segment is the most profitable. If done correctly, a developer can sell at premium prices.”
Unlike many global markets where luxury residential prices have declined or stagnated, Dubai’s market is thriving. According to Knight Frank, Dubai recorded an unprecedented 435 sales of homes worth over $10 million last year, surpassing New York and Hong Kong. The company predicts that the price of luxury properties in the UAE will increase by almost 67% from 2021, and this year will see an additional 5% increase.
Dubai became a popular place for ultra-high-net-worth individuals because it offered them luxury apartments at affordable prices compared to top-class international cities like London and New York.
Mehdi Amjad, who owns Omniyat developing ultra-high-end apartments, stated: “Dubai is one-third less expensive per square meter than New York and one-fifth less expensive per square meter than London.”.
This cost benefit, coupled with Dubai actively courting high-net-worth individuals, makes the city an ideal destination for affluent families looking for second or third homes. Huge investments in high-end real estate not only draw in wealth but also bring economic and social benefits to Dubai.
The construction of luxury homes in Dubai is faced with a number of challenges. Meeting the individual tastes of high-end customers, dealing with the astronomical costs of design and construction, and managing market volatility are some of the key challenges for developers of these opulent homes.
The development of high-end homes has exceptionally high expenses associated with them as a result of the premium materials, one-of-a-kind designs, and special amenities involved. According to Mark Phoenix, CEO of Sankari Properties,
“Adding luxury amenities significantly increases the initial design and construction costs. This is something that scares many developers.”
Apart from the exorbitant prices, personal preferences of affluent clients are a major concern for developers. Wasam Damar, the founder of Palace Real Estate Development Group, says:
“Most of our customers have multiple homes in cities all around the world. They are extremely particular with their tastes and expectations.”
For instance, one of Damar’s clients requested him to create an unobstructed 17×4-meter glass wall for his living room. The wall must be made from a single sheet of glass and disappear entirely when a button is pressed, offering an unobstructed view of the open sea.
In order to make this dream a reality, Damar phoned Germany’s biggest glass factory. The company agreed to construct the wall within 45 days on the condition that a Swiss company came up with the mechanical system of its movement. Then a room was built below the ground level where the glass wall was stored in a collapsed form. Finally, after a lot of effort and extraordinary expenses, the customer’s wish was fulfilled.
Despite the real estate boom of the last few decades, developers and estate agents claim that demand for high-end development has decreased. Price growth has declined, and securing prime sites for new developments is a massive issue for most builders.
Hani Dilami, Managing Partner, Dubai Sotheby’s International Realty, is of the view that wealthy purchasers are finally fighting back after years of rising prices. However, demand still greatly exceeds supply for move-in ultra-luxury homes.
Dilami continued to say:
“The market is still having a hard time coping with a lack of ultra-luxury move-in apartments. A lot of supply is under construction, but three to four years will elapse before it hits the market.”
These issues reflect that, no matter how enticing its glamour may be, the luxury real estate market in Dubai has several impediments. In order to succeed in this market, Dubai real estate developers must be able to cope with the specific tastes of customers, manage construction costs and adapt to market fluctuations.
Dubai is investing big into luxury housing to turn itself into a billionaires’ paradise. Ultra-high-end mansions with sophisticated amenities are behind luring the globe’s wealthiest individuals. Building costs, market volatility, and personal client needs are fantastic challenges. Dubai still keeps insisting on luring ultra-high-net-worth individuals in spite of such challenges, and it may provide economic wealth along with long-term growth to the city.
Source: https://www.propertynews.ae
