At $625 psf, they offer the wealthy a far easier entry point than Hong Kong or London
The average price for such a home right now is about $625 a square foot, and that’s definitely affordable when one looks at the asking value on such properties in 2014, when the market was experiencing its last peak. Then, a top-of-the-line home would have cost the buyer upwards of $3,000 a square foot, with one deal even going for $3,976, according to a report by Knight Frank.
The real estate consultancy reckons the current sale prices would place Dubai among the most “affordable” luxury property markets in the world.
In London, the average prime prices are in the sub-$5,000 a square foot range, while the costliest would soar to $10,000. (Last year, the priciest transaction was set at $15,000 a square foot. Knight Frank defines “prime” as making up the top 5 per cent of the costliest properties in a city.)
But Hong Kong remains the most expensive market tracked by Knight Frank, with an average prime price of $4,251 per square foot in 2018. And over the last five years the top price achieved was an eye-popping $28,154 in 2016.
Dubai developers would definitely be interested in seeing a return of buyers picking up prime properties. Recently, a deal was announced for the second costliest penthouse unit in the city, which sold for Dh73 million at the One Palm, a project from Omniyat. (The costliest deal was also struck at the development, with a unit fetching Dh102 million in 2017.) But there could be demand growing for luxury units, but priced at a more accessible level.
“Dubai remains relatively affordable on a global basis,” said Taimur Khan, Research Manager at Knight Frank M.E. “This relative affordability is not an indication of a lack of prime schemes. In fact, there are a number of schemes where the quality matches or in some cases surpasses what is found in key global cities.”