As the world’s biggest sporting event, the FIFA World Cup is truly a global phenomenon that is equally outstanding in both its importance and impact. With Qatar currently hosting the tournament in 2022, we’re seeing the effects carry over in neighboring countries like the UAE where interest in Dubai real estate, particularly in the luxury segment, has been skyrocketing.
Now, there’s no denying that Dubai has long been a popular destination for buyers all across the globe thanks to its world-class infrastructure, year-round sunshine, and cosmopolitan atmosphere. But, what is further driving this demand for luxury real estate in Dubai over the course of the World Cup?
High-Profile Event = High-Net-Worth Individuals
Given the high-profile nature of the FIFA World Cup and the accommodation crunch in Qatar, Dubai is set to welcome up to a million football fans, many of whom are high-net-worth individuals (HNWIs). Since HNWIs are classified as people who have between $1 million and $5 million worth of assets, luxury properties are typically their purchase preference.
And, considering that HNWIs constitute a good portion of World Cup attendees, then we’re definitely expecting a surge of high-end buyers who would typically seek premium properties in the luxury segment. Not to mention, hotel occupancy rates in Dubai are at full capacity, which is why many visitors have turned to short-term rentals. This has pushed property investors in Dubai to switch from long-term rental structures to holiday homes in order to accommodate this surge over the World Cup season.
Demand For Luxury Properties
Much like the World Expo effect, the World Cup could potentially boost Dubai’s luxury real estate sales due to growing interest from the international elite. In fact, prior to the World Cup, there had already been an influx of high-net-worth individuals either looking to call Dubai home or secure their next trophy asset in the form of a Dubai investment.
Such insatiable appetite and demand for luxury real estate has boosted property prices, especially since there is now a very limited supply of premium units in the emirate, hence why real estate investors are looking to capitalize on potential Dubai investment opportunities.
ALSO READ: What’s Driving Demand For Luxury Real Estate In Dubai?
But, Why Luxury Real Estate In Dubai?
So, to explain this surging demand for luxury Dubai real estate then we need to understand what attracts buyers, HNWI or not, to the emirate in the first place.
For starters, first-time visitors are always impressed with its signature lifestyle, affordability, security, and overall quality of life in comparison with any other major global cities. Other factors, such as its strategic geographic location, investor-friendly initiatives (like the 10-year Golden Visa), and tax haven status, also come into play here.
More specifically, Dubai offers unbelievable value for prime real estate, albeit the emirate’s reputation as a luxury destination. Nevertheless, luxury properties remain highly affordable, with units priced considerably lower compared to other cosmopolitan cities in the world.
Considering that inflation is touching nearly 10 percent in the UK, eurozone growth is forecast to slow in the last quarter of this year, and mortgage rates in the US are at a 15-year high, Dubai has only furthered its appeal in the eyes of investors and buyers. Overall, the emirate has indeed positioned itself as a universally attractive destination for those looking to live and invest in Dubai, as it’s brimming with offerings that very few nations can match.
How Will the World Cup Affect Property Values in Dubai?
However, whether the World Cup can significantly impact the overall real estate market is debatable at this stage. This is mostly due to the fact that the luxury real estate market comprises just 5% of Dubai’s entire property market.
Moreover, Dubai is already witnessing a soaring increase in both demand and property prices in the luxury segment, a trend that escalated during the pandemic as end-users began opting for larger homes. This spike in demand was supported by the influx of European oligarchs, namely from Russia, who saturated the Dubai real estate market earlier this year. So, one could argue that, while the World Cup is touted as a potential boon to Dubai’s luxury real estate, it might realistically speaking, only slightly impact the property market as a whole.
With all this in mind, it’s no wonder that the 1% are increasingly looking to live and invest in Dubai. Supported by rising demand and interest from HNWIs, Dubai’s real estate market has truly become a ‘luxury playground’ to a wide array of wealthy buyers, and the FIFA World Cup is only further reinforcing this ongoing trend. For that reason, the luxury segment will continue to boom, with momentum poised to persist well into 2023.
As of now, demand for luxury properties is outstripping market supply, pushing up property prices in luxury areas in Dubai by nearly 90% in some key locations, like Palm Jumeirah. So, if you’re looking to buy property in Dubai, then look no further! Even if you can’t afford to own luxury real estate or make a real estate investment entirely by yourself, you can invest in Dubai properties through crowdfunding platforms, like SmartCrowd.
Go ahead and check out our latest Dubai investment properties available in the most sought-after luxury communities in Dubai!
Disclaimer: This blog is intended solely for educational purposes and shouldn’t be treated as financial advice. We suggest you always conduct thorough research, perform your own due diligence and consult with financial advisors to assess any real estate property against your own financial goals.