A recent report suggests that Dubai and Sydney are anticipated to witness significant rises in prime residential property values in 2024, solidifying their positions as top luxury housing markets. The Prime Global Cities Index, an annual publication by Savills, tracks changes in upscale residence values across thirty major global cities. Dubai led the list in 2023 with a notable appreciation rate of 17.4%. Predictions indicate that both Sydney and Dubai will outperform other global locations in 2024, with value increases ranging between 4 to 9.9 percent.
Sydney’s above-average gains are attributed to historically low inventory levels and consistent demand from high-net-worth individuals. Savills’ report anticipates ongoing price pressure due to the inability of luxury listings to meet demand.
While Dubai had the strongest real estate performance globally in 2023, its growth rate is expected to moderate as activity returns to a more normal pace. Nevertheless, gains of 4 to 5.9 percent are projected, maintaining the emirate’s status among the top prime residential markets.
Andrew Cummings, Head of Residential Agency for Savills Middle East, attributes Dubai’s continued success to its maturity as a global city, boasting world-class infrastructure and an unparalleled quality of life. Factors such as safety, stability, and a diverse range of property offerings sustain interest from international buyers.
Overall, the Index forecasts a rise in residential values for 2024, albeit at a slower pace than the 2.2 percent average increase seen last year. Sydney, still undersupplied and experiencing strong growth, is expected to see values rise by nearly 10% this year.
Mumbai and Cape Town have joined Dubai as cities with growth exceeding 3 percent over the previous 12 months. Both Indian and South African markets are projected to continue this trend in 2024, with growth rates of 2 and 3.9 percent, respectively.
Major American housing centers may face pressure from rising interest rates, deteriorating consumer sentiment, and economic uncertainty. Hong Kong, due to political unrest and its zero-COVID policy, has experienced a 3.7 percent decline, with potential for a further 10 percent decline if current challenges persist. Shenzhen and Guangzhou might undergo a similar trajectory.
Despite short-term volatility, Savills anticipates long-term property appreciation across established and emerging global hubs, supported by urbanization, wealth creation, and shifting consumer preferences. While forecasts could be influenced by geopolitical changes, overall values are expected to trend slightly higher, with Sydney and Dubai leading the luxury market increases.
