Sales of luxury villas costing over Dh10 million in Emirates Hills have registered a 45 per cent increase, year-on-year, according to, Core, the UAE associate of Savills.
“There was more promising news from Emirates Hills - at 40 per cent, the area witnessed the highest transaction volume among all prime villa districts in the last four quarters,” the consultancy said in a new report.
Villa sales prices and rents have followed identical trends, keeping yields stable between 3.5 and 3.7 per cent over the last four years.
“With limited stock and no new supply of this scale and quality in close vicinity, central location, close proximity to other prime residential and economic clusters makes it the most sought after ultra-prime residential address in Dubai for international buyers,” says company CEO David Godchaux.
“Capitalising on these factors, we expect this niche prime submarket to hold value in the mid- to long-term in addition to holding its ‘elite address’ status.”
Although sales transaction activity levels in Dubai Marina have fallen by 25 per cent year-on-year, the community has created value for investors as prices soften.
“Dubai Marina witnessed the highest transaction activity in the apartment segment over the last few years.
“As expected, headline occupancy levels are nearly 90 per cent in top performing towers and the prime rental market has remained relatively steady due to the continued demand from expatriates.
“Nonetheless, prime sale prices have dropped 8 per cent year-on-year, although this has created investor opportunities through stable yields averaging between 5-6 per cent,” adds Godchaux.
The softened sales market is pushing financially sound investors to take a long-term approach by holding onto properties and leasing prime assets rather than flipping in Downtown, as the rental market continues to be strong.
Transaction levels have, however, come down by 19 per cent.
The district, which houses Burj Khalifa, the world’s tallest tower, and the new Dubai Opera, maintains its high headline occupancies, currently ranging over 85 per cent across most of the prime towers.
The rental market has shown a two per cent year-on-year increase, bucking apprehensions of a weakening rental demand due to a consolidating financial jobs market.
According to Core, the prime residential prices in Dubai are almost 60 per cent below prime New York, 75 per cent below prime London and 85 per cent below prime Hong Kong.
“Aided by the current softened sales market, potential capital appreciation and higher long-term yields, Dubai’s prime residential real estate is extremely good value by global levels.
“With no holding charges and comparatively lower transaction costs, Dubai stacks up favourably against other competing global cities as an investment destination for global ultra-high net worth individuals and investors,” states Godchaux.