Spotlight: The Booming Middle East Luxury Real Estate Market
The Middle East has been a leading real estate market for decades, with countries such as the United Arab Emirates (UAE) and Saudi Arabia consistently appearing on lists of luxury real estate hotspots for the ultra-high net worth set.
In particular, the UAE has seen a huge influx of wealth, as the number of USD millionaires has grown by 98% since 2015. More than 7,000 millionaires moved to the UAE in 2024 alone, bringing the total number of resident high net worth individuals to 134,000. Most of these individuals have moved from India (31%), other countries in the Middle East (20%), and Russia (14%).
WEALTH AND TOURISM DRIVE GROWTH IN LUXURY REAL ESTATE
As one might imagine with such a profound influx of wealth, the UAE has seen enormous growth in its luxury real estate market, with a record number of homes in the USD $10 million+ range purchased in 2024 and early 2025. Luxury real estate is also thriving in Saudi Arabia, where the Saudi Vision 2030 has led to sustained development and expansion. In 2024, the luxury real estate market in the Kingdom was valued at $15.1 billion, but it is projected to grow to $25.7 billion by 2033.
Tourism is an additional significant driver of growth in the Middle East, particularly high-end tourism for high net worth individuals. Dubai and Abu Dhabi lead the luxury tourism market in the UAE, while Riyadh, Jeddah, and Makkah stand out in Saudi Arabia. Meanwhile, tourism in Muscat, Oman, has also seen rapid and sustained growth.
As tourism has expanded, so too has the market for hotels, resorts, and vacation homes. The influx of business travelers, affluent tourists, and expatriates have contributed to rapid growth and increased prices as second homes and luxury short-term rentals have become increasingly popular.
Government policies are also making the region desirable for relocation at least part-time. For example, the UAE offers a long-term Golden Visa program with flexible residency requirements and other exclusive benefits. Expatriates and second-home buyers are not only coming from outside the Middle East, but also within the region, as wealthy individuals seek to park their money in thriving markets and take advantage of ideal living conditions, thriving business centers, and a wide range of luxury entertainment options. Research from Knight Frank in 2022 showed that as many as 44% of Saudi homeowners were interested in buying second homes, often as a form of investment. Meanwhile, ultra-wealthy individuals from the Middle East own the most homes globally, at an average of four. This average is greater than that of the ultra-wealthy in Russia (3.5) and Europe (2.7).
Chinese investors are also taking a keen interest in the Middle East real estate market. As the domestic market in China continues to struggle, the country’s upper class is looking outward for investment opportunities that also provide a change of scenery and an attractive lifestyle. Real estate purchases in the UAE by Chinese nationals have quadrupled over the past three years, reaching USD $450 million in 2024, according to Aldar, the Emirati real estate development company owned by the Abu Dhabi government.
ULTRA-WEALTHY BUYERS
While millions of high net worth individuals are eyeing the Middle East for investment properties and second homes, it is the smaller cadre of ultra-wealthy individuals who continue to drive the market. Around 1,300 of the world’s richest individuals own second homes in Dubai, including 500 individuals with over $100 million in investable assets. The emirate now ranks in the top 10 globally for second home ownership by the ultra-wealthy, and by most estimates is expected to continue to climb that list in the coming years.
Meanwhile, at least 20 billionaires are residents of Dubai. Again, the emirate’s wealth will likely only increase in the near future—its centimillionaire population is expected to more than double by 2035. Besides the UAE’s lack of personal income and capital gains taxes for most individuals, Dubai also offers great diversity, ample opportunities for shopping and recreation, well developed infrastructure, a business-friendly economy, and excellent connections as a global travel hub.
A NOTE OF CAUTION
Despite this astronomical growth, there are some who are advising caution when it comes to the luxury real estate market in the Middle East. Findings from a recent UBS index indicate that Dubai has seen the highest increase in real estate bubble risk among two dozen leading global cities.
At the same time, Saudi Arabia’s Crown Prince Mohammed Bin Salman announced a five-year rental freeze on both residential and commercial properties in Riyadh in late September 2025, as price increases have become borderline unsustainable. These and other findings indicate that, while the real estate market in the Middle East is growing at incredible rates, it may also be susceptible to a variety of factors that could lead to a rapid price shock.
As with any investment in real estate, it is advisable to do due diligence and ensure that local markets are comprehensively understood.