The prices of luxury properties in the Abu Dhabi and Dubai markets have shot up by 4.3 percent over the first three quarters of this year, says the latest report by Knight Frank, the leading global property consultancy.
The Head of Residential Research at Knight Frank, Liam Bailey, said that luxury homes in prime global cities will retain their reputation of being a safe haven, and will hardly draw any speculative investors seeking short-term gain.
Abu Dhabi will witness growing demand for newly-built properties in future, the report said. Abu Dhabi has topped the list of 10 future locations tipped for growth in prime locations across the globe, and is likely to see increased demand for newly built properties, as per the report by Knight Frank.
The savvy-minded investors across the globe have tagged prime properties as a safe haven investment over the past three years. Wealthy investors are looking forward to stability of luxury properties in major cities, as against the sovereign debt concerns and geo-political uncertainty of other nations.
The global trend prediction turns out to be good for luxury properties in Dubai, Abu Dhabi and the rest of UAE, with savvy investors, continuing to seek differentiating factors, so that their properties can hold on to their values in the wake of global uncertainty.
The Knight Frank report has taken into account the properties that have managed to recover faster from their 2008-09 economic downturn despite the current economic gloom, by assessing their long-term values.
The report points out examples wherein cities have managed to hold on to the prices of luxury properties. The prime properties in London and New York are now 37 and 25 percent above their recessional lows, while in Asia, luxury homes in Hong Kong are now 72percent higher than their lowest in 2008, while Shanghai and Mumbai have recorded 115 and 220 percent growths respectively, from their market lows.
The evidence also suggests that prime luxury properties in the UAE have been able to hold on to their values in a better manner than other developers during their phase of property crash during 2008-09, and they have been the first to recover.
With the UAE realty market beginning to stabilize following global economic crisis, the luxury real estate sector has continued to throw strong indications of recovery, during the last quarter of 2011, wherein unique luxury developments such as Al Barari in Dubai, are continuing to draw local and international investors, the report pointed out.
Therefore, the prices of luxurious residential properties have remained close to their 2007 levels, despite the bad economic scenario, and the negative impact that it had on property prices throughout Dubai, the report said.