The past few years has seen an ever-increasing number of significant news stories related to record-breaking real estate sales for mind-boggling amounts of money. Case in point – March 2022 saw Indian billionaire Mukesh Ambani purchase a stunning mansion on Palm Jumeirah for $80 million.
But he wasn’t finished there, because in October of the same year the tycoon sealed a deal for another epic villa on the palm-shaped island. This time it was a 10-bedroom, 33,000 square foot, custom-built masterpiece for which he paid a whopping $163 million, making mere double-digit million prices for prime properties in Dubai seem almost inconsequential.
What’s interesting though is that investment at this level is not just a movement of the few. The list is long and illustrious, including the likes of UK-based billionaire Lakshmi Mittal and Chaopeng Zhang, the CEO and founder of Binance.
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Add in the crypto super-rich, hedge fund executives and Israeli investors (following the signing of the Abraham Accords), and it soon becomes clear that a millionaire/billionaire migration is headed straight for Dubai real estate.
The question is, why are the wealthy from around the world shopping for super luxury properties in Dubai and willing to pay record-breaking sums for it? Dubai is still very young in comparison to London, New York, Los Angeles and Hong Kong – global metropolises that offer some of the highest appreciation in property values. So why Dubai?
Brand Dubai: Attracting millionaires with prestige
The answer to that may lie in the “Brand Dubai” – the Dubai that has been marketed for its ease of doing business, upscale lifestyle, premium facilities and of course, luxury properties. The lure of Dubai for these investors can be best described in the words of the aforementioned Chaopeng Zhang, CEO and founder of Binance, who praised the city for its “progressive and good business environment”.
It could be said that the Brand Dubai is serving as a carefully strategised cure to the hurdles manufactured in the millionaires’ native lands and political systems. Take for example, the UK, which has the ‘Wealth Tax Commission’ sitting around thinking of ways to tax the wealthy. Australia has a 6 percent tax on net wealth for billionaires, whereas the US has a wealth tax of 2 percent on net assets above $50 million – the list goes on. It’s only fair for these HNWIs to seek greener pastures elsewhere.
While having a business-friendly ecosystem and excellent policy-making attributes contribute to an environment conducive to attracting foreign investment, it is only the tip of the iceberg. Brand Dubai, in all its glory, has a lot more to offer to millionaires across the globe, with good value for money being the most prominent of these offerings.
Dubai real estate: Unbeatable value and returns
For starters, the price per sq. ft. for ultra-luxury properties in Dubai is actually lower than one might think, especially when compared to other luxury cities in the world. A $1 million can get you a whopping 1,130 sq. ft. of luxury property in Dubai as opposed to just 183 sq. ft. in Monaco. Los Angeles may have more than its fair share of luxury hill top properties available for the millionaires, but in Dubai the same spend affords 170 percent more property. That is a serious upgrade!
To put things in perspective, here’s the size of property you can get in luxury cities across the globe, with $1 million:
- Monaco: 183 sq. ft.
- Hong Kong: 226 sq. ft.
- New York: 355 sq. ft.
- London and Singapore: 366 sq. ft.
- Geneva: 398 sq. ft.
- Los Angeles: 420 sq. ft.
- Dubai: 1,130 sq. ft.