Dubai has once again solidified its status as a leading luxury real estate market, marking a record-breaking year for high-end property sales. The demand for homes valued at over $10 million surged dramatically, reflecting the ongoing influx of affluent individuals choosing the emirate as their prime destination.

Luxury Home Sales Surge

In the previous year, the sales of luxury homes priced above $10 million in Dubai reached an impressive 500 transactions. This represents a 15% increase in volume and a remarkable 28% rise in total value, hitting $9.05 billion, as reported by Knight Frank. The growth trend indicates a robust appetite for luxurious living spaces, particularly among high-net-worth individuals (HNWIs). Notably, 68 of these sales were for properties exceeding $25 million, a staggering 48% increase compared to the previous year.

The factors driving this boom include Dubai’s high quality of life, top-tier amenities, and world-class infrastructure. Faisal Durrani, a partner and research head at Knight Frank, stated that numerous investment initiatives by the government have played a crucial role in attracting global wealth to the emirate. The introduction of residency permits for retirees and remote workers, coupled with the expansion of the 10-year golden visa program, has also contributed to this influx.

Attracting Global Millionaires

The United Arab Emirates has become a magnet for HNWIs worldwide. According to a report by Henley & Partners and New World Wealth, the UAE attracted a record 9,800 relocating millionaires in the last year alone, lured by favorable regulations and a tax-free lifestyle. As of 2024, Dubai is estimated to host around 81,200 millionaires and 20 billionaires, underscoring its attractiveness as a place for wealth accumulation and investment.

Among the neighborhoods seeing the most activity for luxury homes are Palm Jumeirah and Palm Jebel Ali. The fourth quarter alone recorded 143 transactions for properties valued at over $10 million—an annual increase of 39%. Both Palm Jumeirah and Palm Jebel Ali emerged as the top locations for high-end purchases, as factors like their waterfront locations continue to entice wealthy buyers.

Palm Jebel Ali and Future Developments

Palm Jebel Ali, in particular, is set to become a significant player in Dubai’s luxury property market. This upcoming development is planned to be 50% larger than its counterpart, Palm Jumeirah, and will feature seven islands along with 16 fronds, creating over 90 kilometers of beachfront. This project aims to accommodate around 35,000 families and will include numerous green spaces and amenities, along with 80 hotels and resorts.

Mr. Durrani noted that while Palm Jebel Ali is still in the early stages of development, its sales figures reflect high potential. These developments are aligned with the broader Dubai 2040 Urban Master Plan and the Dubai Economic Agenda D33, indicating a commitment to ongoing growth and urban expansion.

Record-Breaking Sales and Market Dynamics

The Business Bay area saw the most expensive sale of the fourth quarter, with a six-bedroom apartment in Bugatti Residences by Binghatti fetching an astonishing Dh550 million (approximately $149.7 million). This sale shattered previous records for penthouse transactions in the UAE, underlining the opulent market dynamics.

Anticipations for property prices indicate a continued upward trajectory in the coming year, albeit at a slower pace. Following an impressive 194% appreciation since late 2020, prime property values are expected to rise by about 3% throughout 2026. The market is experiencing genuine end-user activity, with many buyers acquiring residences for personal use, signaling a shift towards a more stable real estate environment. According to Knight Frank, this evolution marks Dubai’s progress from an “emerging” market to a well-established real estate landscape.