DUBAI: Dubai’s red-hot property market surged in the first half of the year as investors piled in, with Russians among the top five buyers as the emirate benefits from an influx of wealth in the wake of Western sanctions.

The first half saw residential real estate transaction volumes up 60 per cent with an 85pc rise in the value of properties sold, property consultancy Betterhomes said in a report.

The top buyers were from India, the United Kingdom, Italy, Russia and France, in that order, followed by Canada, the United Arab Emirates, Pakistan and Egypt tied in eighth place, Lebanon and China.

The number of Russian buyers surged 164ppc in the first half of this year from the first half of 2021, Betterhomes said in response to a query. The numbers for France and Britain rose 42pc and 18pc, respectively, while those from India fell 8pc and Italy dropped 17pc.

Market surges 60pc as investors flock in; India, UK, Italy, Russia, France top five buyers

Demand was boosted by geopolitical instability in Europe and mortgage buyers looking to get in ahead of well-telegraphed interest rate hikes, Betterhomes said.

It was reported earlier this year that Russians were pouring money into Dubai properties, seeking a financial haven in the wake of Western sanctions on Moscow over its invasion of Ukraine.

“The market has faced growing headwinds in the form of rising interest rates and a strengthening dollar but has so far proven to be robust with little sign of slowing,” Betterhomes said.

In the first half of the year, a record 37,762 units were sold, it said, citing Dubai Land Department data, with residential property market transactions totalling nearly 89 billion dirhams ($24.23bn).

Dubai’s property market began recovering from 2020’s severe downturn early last year with buyers snapping up luxury units after the emirate eased pandemic restrictions faster than most cities around the world.

However, S&P Global Ratings said in October that Dubai’s real estate recovery was fragile and uneven, and an oversupply of residential properties would pressure prices in the long run.

Luxury property transactions were up 87pc compared with the first half of last year, with apartments making up 62pc of all transactions, Betterhomes said.

Investors dominated sales, making up 68pc of all buyers, up 10pc compared with a year earlier.

Published in Dawn, July 30th, 2022