The luxury real estate market in Dubai may be heading for a swift revival according to several studies and reports. There is higher demand for luxury properties in Dubai across both villa and apartment categories. With regard to the price per sq. ft, luxury properties usually outstrip the average price threshold in the city. Between the years 2012-2014, the spread between regular and prime real estate kept increasing with more investors pumping money into the luxury real estate segment. However, the market was a little down in the year 2014 and there was shifting demand for affordable homes, leading to a lowering of this spread.
However, experts have observed an increasing spread once again and reversal of the market trends over the last year or so. There is growing demand for prime and luxury properties in Dubai as per several studies and reports. The widening of the spread certainly indicates an upcoming bull market for the luxury property segment which should be good news for several developers and the realty industry in general. After the year 2014, this spread came down by 265 per sq. ft. and 340 per sq. ft. for the villa and apartment categories respectively. Higher demand was seen for affordable housing as well.
However, there are some uniquely observed market trends as well. In the Dubai Marina and Palm Jumeirah, there have been contrasting developments. For the former, the price difference between overall market and prime category has been narrowing steadily. This indicates a shift towards an aggregate mean price as far as developers are concerned. However in case of Palm Jumeirah, the luxury apartment segment has boomed and outperformed estimates, indicating variability factors in terms of the location and quality of the building.
Spreads have come down considerably between Jumeirah Lakes Towers and the Dubai Marina with more buyers seeking out bargains and a growing demand for mid-income housing. However, luxury demand is already rising swiftly in several areas and the spreads will be widening in the near future although this will be quite nominal. In case of the villa segment, the Meadows/Springs community has been outstripped by Arabian Ranches due to the release of more expensive new housing stock.
