With prime residential prices accelerating at the world’s fastest pace last year, Dubai once again topped the global Prime International Residential Index 100 (PIRI 100) for 2022 while claiming 16th rank among the most expensive cities for luxury properties, underlining its increasing attractiveness and affordability to the world’s super-rich.
According to Knight Frank’s The Wealth Report 2023, the value of PIRI 100, which tracks the movement in luxury house prices across the world, prime residential prices in Dubai surged 44.2 per cent in 2022 compared to the global average of 5.2 per cent year-on-year basis, reinforcing its position at the top of PIRI 100.
Real estate pundits said the feat underscored Dubai’s enduring appeal as a global hub for ultrahigh-net-worth individuals (UHNWIs) underpinned by a spate of investor reforms and visa incentives.
In the Wealth Report, which provides a fascinating breakdown of the number of square meters of prime property $1 million could buy in 2022, Dubai figures 16th with 105 square metres of space while the tiny Principality of Monaco, where one in three people live is classified as a millionaire, topped the table as the most expensive city in the world, where $1 million can get you 17 sqm of space.
Cities among the world’s most 20 expensive include Hong Kong (21sqm), New York (33 sqm), Singapore (34sqm), London (34sqm), Geneva (37sqm), Los Angeles (39sqm), Paris (43sqm), Sydney (44sqm), Shanghai (44sqm), Beijing (58sqm), Tokyo (60sqm), Miami (64sqm), Berlin (70sqm), Melbourne (87sqm), Dubai (105sqm), Madrid (106sqm), Mumbai (113sqm), Cape Town (218sqm), and Sao Paulo (231sqm).
Of the 100 markets tracked in PIRI, which analyses prime property price performances in 100 cities, sun, and ski locations globally, 85 recorded positive or flat price growth in 2022, the report said. The Americas (seven per cent) narrowly upstaged Europe, the Middle East, and Africa (6.5 per cent) to the title of the top-performing region, with Asia-Pacific trailing at 0.4 per cent.
“Last year we referred to 2021 as ‘an anomaly’. The year was characterised by stellar price growth as markets reopened following Covid-19, and revenge spending took hold. After a boom like that, you could be forgiven for thinking that 2022 would mark a return to business as usual. Far from it. Leaving aside the year 2021, the year 2022 posted the highest level (5.2 per cent) of core price growth on an annual basis since the global financial crisis,” Kate Everett-Allen, partner of Residential Research at Knight Frank, said.
“Wealth preservation, safe-asset capital flight, and supply constraints played their part in driving the major price increase, but it was the post-pandemic surge that continued to push prices higher,” Everett-Allen said.
For, it has increased their appetite to buy with 17 per cent of UHNWIs to add to their portfolio in 2022, he said.
Mumbai’s prime property market witnessed a price appreciation of 6.4 per cent which moves up the city to 37th position on the PIRI 100 in 2022 as opposed 92nd in 2021. Prime properties in Mumbai are expected to witness an appreciation of three per cent in 2023, the report said.
Bengaluru’s prime property appreciation by 3.0 per cent moved up the city’s position to 63rd in 2022 from 91st in 2021. Delhi’s prime property market saw value appreciating by 1.2 per cent which moved up the ranking to 77th from 93rd in 2021, the report added.