UAE luxury real estate: not just a place to live, but a profitable investment

Who said that luxury villas, townhouses and mansions in the UAE are only for living? The UAE luxury real estate market is showing impressive growth, confirming their status as not only prestigious housing, but also a highly profitable asset.

In the third quarter of 2024 alone, prices for luxury real estate soared by 16.6% compared to the same period in 2023. Despite the higher cost of entry, investments in this segment are ahead of the average market in terms of growth, and this is natural. Let's figure out why.

1. Limited supply is the basis for sustainable growth: The key factor determining high cost and stable price growth is the shortage of land for development in prestigious locations. Elite complexes, as a rule, are small exclusive collections of residences, which automatically limits supply and increases demand.

For example, projects on the coast of Dubai, near famous golf clubs or with a view of the legendary Burj Khalifa, are always in great demand, and new offers appear extremely rarely. Construction of new facilities in such areas often faces bureaucratic difficulties and high costs, which further limits the supply.

2. Uniqueness and exclusivity are the key to high cost: Elite real estate in the UAE has unique characteristics that significantly increase its value.

This may be proximity to recently opened facilities, such as the first casino in the region, which automatically increases the status and attractiveness of the area. Also playing a role is the location near protected natural areas - reserves or national parks, providing residents with peace, privacy and closeness to nature.

Project branding is no less important - famous architects, interior designers and landscape architects attract buyers who value exclusivity and quality. For example, residences designed by world-famous architectural stars are significantly more expensive than their analogues, even with comparable characteristics.

3. Value for money – premium properties at world prices: When comparing UAE luxury properties with similar offers in other countries around the world, you will notice a good value for money.

For the same money, you will get significantly more space, more luxurious finishes and developed infrastructure. In European capitals or US resorts, comparable properties can cost significantly more, while offering less living space and, perhaps, less developed infrastructure. This makes the UAE an attractive market for international investors interested in getting the most out of their investment.

Additional factors influencing price growth:

• Stable political and economic situation: The UAE offers investors stability and predictability, which is important for long-term investments.
• Developed infrastructure: Modern transport system, first-class medical care and high-quality educational institutions attract wealthy people from all over the world.
• Favorable tax climate: No income tax for residents and favorable conditions for foreign investors make the UAE an attractive place to buy real estate.