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Dubai, Miami top list of best luxury real estate markets for 2023

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Residential villas on the waterfront of Palm Jumeirah, Dubai, February 24, 2022. Russians have always been among the top 10 nationalities investing in Dubai real estate, according to Tahir Majisia, managing his partner at Dubai-based Prime Capital Real Estate.

Christopher Pike/Bloomberg via Getty Images

Wealthy investors betting on luxury real estate will do their best by putting their money in Dubai or Miami next year, according to a new report.

Ranked 25th among the world’s top luxury or ‘prime’ property markets, Dubai tops the list with prices expected to rise by 13.5% in 2023, according to property consultancy Knight Frank. Miami is his No. 2, and prices are expected to see him rise 5%. Dublin, Lisbon and Los Angeles will follow, with growth of 4%.

The worst performers next year will be Seoul and London, where prices are both expected to fall by 3%. New York sits in the middle of the pack at his 13th place and prices are expected to rise by 2% next year.

Still, even the strongest luxury market is expected to cool next year as interest rates rise and the economy slows, according to Knight Frank. Knight Frank expects prices to rise by an average of 2% in his 2023 across 25 cities. That’s down from his 2.7% forecast by Knight Frank six months earlier.

The revision suggests that the world’s wealthy, who seem immune to inflation and the economic slowdown, are holding back on large property purchases or becoming more price sensitive in light of rising interest rates. doing.

“The prime market is immune to rising mortgage costs, but it is not immune,” the report said. “The shift from a seller’s market to a buyer’s market is already underway in most major housing markets.”

Dubai saw a 50% increase in prices in 2022, indicating a significant slowdown in price growth in 2023. Dubai has seen a surge in wealthy residents over the past year, largely due to Russians looking for a safe harbor for wealth, yachts and real estate amid Western sanctions over the war in Ukraine. Thing.

Prices for single-family homes in Dubai rose 13% in October, with overall sales up 73% year-on-year.

Miami is also a popular haven for the wealthy due to low tax rates and a growing number of financial firms with headquarters and offices in South Florida.

The expected 2% rise in New York next year is down from 2022, but many brokers are predicting prices will fall next year, especially in Manhattan. Knight-Frank said New York would benefit from overseas buyers who “seek to increase, rather than reduce, their exposure to the U.S. dollar as the Federal Reserve raises interest rates.”

According to the report, Singapore is the only Asian city in the top 10 and one of four cities to see an increase in forecasts in the last six months. Singapore has benefited from the flight of wealth from China. Wealthy Chinese citizens are moving their money, and often their families, to Singapore to avoid a draconian COVID-19 lockdown and economic slowdown.

Knight Frank said cash will be king in 25 markets. relegated to the high-end luxury market.”

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