While 2020 was a tough year on the UAE real estate market, luxury real estate in the residential market has become the light at the end of the tunnel.
Luxury real estate started to pick up in 2020, with an increase in demand for luxury affordable units. The UAE has continued to become an attractive destination for buyers to purchase a luxury home, and a rise in demand is expected to bolster sales in this market.
POSITIVE SIGNS FOR LUXURY REAL ESTATE IN THE UAE
The luxury real estate market is currently seeing interest from Indian businessmen due to the second wave of COVID-19 in India, in addition to steep taxation rates for high net worth families. This demand is further prompted by recent policy-level initiatives by the UAE government, including new residence visa options and full foreign ownership of businesses located in the country.
These reforms, along with attractive mortgage rates in the real estate market, have shown promising signs of recovery in the country’s property market. In March 2021, wealthy home buyers purchased a record 84 luxury homes, worth over USD 2.7 million.
Further, although apartment prices continued to fall in the previous month, prices of high-end villas stabilised with an upward trend in the sale of luxury villas, along with sea-view apartments and second-hand family houses. Prices of villa properties rose 3.9% in the first quarter of the year.
Further, ultra-luxury real estate deals reportedly reached USD 68 million in transactions in Q1 2021, pushed by surging demand in this segment from wealthy buyers and investors who are keen on secondary markets.
LUXURY PROPERTIES IN THE PIPELINE THIS YEAR
Several luxury properties have already been announced this year, including an apartment complex located in Sharjah’s Aljada by Arada. The developer awarded a contract for USD 49 million to develop three high-end apartment blocks in the community to Dubai-based Al Ashram Contracting.
Dubai also announced the world’s first Sea Palace Floating Resort near Dubai Marina. The project comprises a hotel and six floating glass boat villas, priced at about USD 5.5 million each. The villas have been licensed as yachts, and will consist of two floors, with a balcony, and an outdoor swimming pool on the roof.
Further, Nakheel and Select Group also announced plans for the development of branded luxury homes and a boutique hotel on a beachfront plot in Palm Jumeirah’s West Crescent.
Photo credit: www.aljada.com/en/discover/residences/misk-apartments,
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