February 25, 2021 real estate

31% of multi-millionaires in Middle East plan to buy new home in 2021


Home sales in the UAE and around the region are likely to get a boost this year, with about a third of multi-millionaires looking to buy a new house in 2021, according to a new report.

In a Knight Frank survey among ultra-high-net-worth individuals (UHNWI) in the Middle East, 31 percent said they are planning to buy a residential property this year. Globally, the number of potential homebuyers reached 29 percent, up from 21 percent in 2020.

“This demand will help fuel price rises of up to 7 percent in key markets over the course of the year,” Knight Frank said.

Among the preferred locations, the UAE is high on the list, as well as rural and coastal areas. Properties with access to open space is highly sought after.

“The pandemic is super-charging demand for locations that offer a surfeit of wellness – think mountains, lakes and coastal hot-spots,” the property consultancy firm said.

Property sales

Sales of ready homes in Dubai have increased in recent months, with buyers snapping up properties that offer ample living space. A clear favourite are residential units in villa communities, especially those with private gardens and access to good quality amenities.

According to Taimur Khan, head of research at Knight Frank Middle East, the UAE is ranked in the top five of locations where home purchases are planned.

“Despite price prices softening in almost all key markets, demand for prime residential property has remained robust throughout 2020. There are also early indications that we are seeing these markets [entering] new market cycles,” said Khan.

Prices

House prices and rents in the UAE have fallen throughout the pandemic. The decline in prices has attracted interest from first-time homebuyers.

Knight Frank indicated that there may no longer be price declines in the prime residential market this year. Prices of apartments and villas on the Palm Jumeirah, for instance, increased by 5.1 percent and 9.4 percent, respectively, in the six months to December 2020.

Over the same period, villa prices in District One have gone up by 3.5 percent, while other prime markets such as Downtown Dubai and Emirates Hills are showing an uptick.

“While Dubai’s prime residential market saw prices decrease by 5.9 percent in the year to November 2020, we are beginning to see signs of a recovery in price performance in some prime sub-markets,” said Khan.

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