By Abbas Sajwani
The UAE’s uber-luxury real estate segment appeals to HNWIs for several good reasons, in my opinion. It offers a diverse range of properties, favourable tax regime, and a raft of investor and property owner-friendly government initiatives, to name just a few appealing aspects.
The market for uber-luxury property, by its very nature, is small. And yet Dubai registered 88 home sales valued at over US$10m in Q1 2023, according to reports. The city is now regarded as the fourth busiest luxury homes market in the world.
I’d go as far as suggesting that the UAE has emerged as a global hub for luxury real estate, attracting Ultra- and High Net Worth Individuals from all over the world.
The diverse range of (luxurious and uber-luxurious) properties available caters to the (often very specific) needs and preferences of HNWIs. From luxury villas to high-rise serviced penthouses with stunning views of the Arabian Gulf or city skylines, the UAE’s real estate market holds wide appeal for heavyweight investors. And unlike, for example, London or New York City, properties are often far more spacious, with ample grounds, and come equipped with state-of-the-art amenities, such as private pools, gyms and spas.
In 2022, the Henley Global Citizens Report suggested the UAE attracted 4,000 millionaires. Uber luxury properties are now in short supply. And that short supply drives up prices, creating further demand.
A Dubai luxury property will often include very high-grade materials and finishes, as savvy Dubai developers know how to make a property go from run-of-the-mill to uber-luxurious. Some developers have teamed with luxury brands to provide high-end fixtures and fittings. And those seeking apartments – or should we say penthouses – demand and expect designer touches throughout their properties.
Just a few months ago, we saw the sale of Dubai’s most expensive apartment, a nine-bedroomed penthouse at the Bvlgari Lighthouse on Jumeirah Bay Island, which reached US$112 million. Notably, it was purchased off plan – the 27-storey tower is slated for completion in 2027.
The UAE’s strategic location – coupled with economic and political stability – ensures it remains a desirable destination for investors seeking stable, lucrative returns on their investments. The UAE serves as a gateway to the Middle East, Africa, and Asia, making it an attractive destination for business and commerce. The country’s favourable tax regime is also a clear contributor to its appeal to HNWIs.
Those millionaires seemingly flocking to the UAE are from a variety of different places – Russia, India, Africa, the rest of the Middle East, Europe and the US, underlining its wide appeal. Dubai is clearly making a strong global impact on HNWI investors, who are keen to find the ultimate location, and the best properties at the best prices. And of course, it’s no surprise to me that people are also attracted to Dubai for its luxury lifestyle, world-class dining, fantastic beaches and all-year-round good weather.
The UAE government has introduced several initiatives to attract foreign investors to its real estate market.
Beyond the low-to-no tax regime, property purchase for foreign nationals is allowed, and the process is straightforward. As an HNWI, if you invest more than AED2m in property, you can receive a ten-year ‘Golden’ visa. There’s also the five-year ‘Green Visa’ option for investors who can show proof of their investment in the UAE.
Ease of buying and clear visa options undoubtedly make purchasing or investing in an uber-lux Dubai property a wise decision.
Changing desires and global politics mean the UAE looks set to continue welcoming an influx of UHNWIs and HNWIs, whether they are looking for investment, a second home or a forever home of their own, it seems the UAE is delivering exactly what uber-luxurious property seekers want.