DUBAI — The luxury property boom has taken a hit as higher interest rates, which have raised borrowing costs, take their toll. Yet Dubai saw an increase in sales of $10 million-plus homes and had the highest global sales volume in this market, at $1.5 billion, in the second quarter of this year.
In a survey of 12 key international markets, the sale of residential properties above $10 million, or super-prime estates, fell 13% in the second quarter (Q2) from April to June 2023 compared to the same period last year, reported real estate consultancy Knight Frank in its Global Super-Prime Intelligence report released Thursday.
The total number of these luxury residential sales in the 12 months through June dropped slightly under $30 billion in the surveyed markets, dropping by about one-fourth of its value during that period in 2021 at $40.7 billion.
This year’s numbers still highly exceed pre-pandemic sales, which hit lows of $18.6 billion in 2019 — although after 11 rate hikes until the present and with a federal policy rate that’s reached within 5.25%-5.50%, the luxury property market is feeling the burden.
