In the 2024 forecast, Dubai has been identified as the foremost global real estate market for the growth potential of luxury homes. A recent report by Savills, a prominent global real estate firm, reveals that both Dubai and Sydney are poised to experience the most substantial growth in prime residential property values throughout 2024, further solidifying their positions as top-performing luxury housing markets.
Savills’ annual Prime Global Cities Index meticulously monitors changes in capital values of premium homes across 30 major cities worldwide. In the preceding year, Dubai claimed the top spot with an impressive 17.4 percent appreciation. According to the 2024 forecast, Dubai and Sydney are expected to surpass other global locations, with projected value increases ranging between 4 and 9.9 percent.
The report attributes Sydney’s above-average gains to historically low inventory levels and sustained demand from high-net-worth buyers. The luxury property market in Sydney has struggled to keep pace with demand, resulting in upward pressure on prices, a trend that Savills anticipates will persist into the next year.
Dubai, having demonstrated the most robust real estate performance globally in 2023, is projected to experience a slightly moderated growth rate as activity returns to a more typical pace. Nonetheless, the forecast suggests gains of 4 to 5.9 percent, positioning Dubai among the top two prime residential markets.
Andrew Cummings, Head of Residential Agency for Savills Middle East, attributes Dubai’s continued success to its maturity as a true global city, boasting world-class infrastructure and an unparalleled quality of life. Factors such as safety, stability, and a diverse range of property offerings contribute to sustaining interest from international buyers.
The broader outlook of the Index predicts an overall upward trend in residential values in 2024, albeit at a slower pace than the 2.2 percent average rise observed last year. The forecast indicates a modest increase of 0.6 percent across the 30 monitored cities, with most expected to register gains between 0 and 3.9 percent. Seven locales may experience small declines.
Sydney, having recorded a growth of 6.8 percent in 2023 and remaining undersupplied, is well-positioned for further appreciation. Savills estimates values to climb to almost 10 percent this year. Mumbai and Cape Town, alongside Dubai, are the only cities exceeding 3 percent growth over the past 12 months, and both are anticipated to maintain that momentum with increases of 2 and 3.9 percent in 2024.
Some American housing centers may face challenges due to continued economic uncertainty, higher interest rates, and weakening consumer sentiment. San Francisco, in particular, experienced a steep downturn at -6.1 percent, potentially facing further erosion. Asian markets, such as Hong Kong, may also be affected by a risk-averse investment environment, with declines extending beyond 10 percent if challenges persist.
Despite short-term volatility, Savills anticipates that ongoing urbanization, wealth creation, and changing consumer preferences will underpin long-term property appreciation across established and emerging global hubs. While geopolitical shifts could impact forecasts, overall values are projected to trend modestly higher, with Dubai and Sydney leading gains in the luxury sector.
News Source: Arabian Business