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As conflict casts a shadow across the Middle East, people are getting rich in Dubai.<\/p>\n
The desert sheikdom\u2019s economy is buzzing with tourism and construction as it positions itself as a safe haven in a region that\u2019s\u00a0resting on a knife\u2019s edge<\/a>\u00a0following the\u00a0assassination of Hamas leader Ismail Haniyeh<\/a>\u00a0in Iran.<\/p>\n \u201cDubai is in a very unique position. We happen to be the net beneficiary of crisis in the region, for good or bad,\u201d Zhann Jochinke, the chief operating officer of real estate consultancy Property Monitor, told The Associated Press.<\/p>\n Dubai has a long history of indirectly benefiting from crises in the region. When the ultra-wealthy worry about turmoil, the city offers stability, low taxes and a friendly visa system.<\/p>\n The current turmoil has situated Dubai to capitalize once again, as it did during the\u00a0COVID-19 pandemic<\/a>\u00a0and\u00a0Russia\u2019s invasion of Ukraine<\/a>.<\/p>\n Demand is running red hot in Dubai\u2019s real estate market, catapulting glitzy properties to record-breaking valuations. Not even historic flooding in April could dampen the bull market.<\/p>\n State-backed Emaar Properties, whose name is splashed across Dubai\u2019s skyline, announced that its development business made $8.1 billion in sales through the first half of the year, up from $5.2 billion over the same time period last year.<\/p>\n Across the city, valuations for Dubai\u2019s upscale villas have set a new record, increasing around 38% in the second quarter of 2024 compared to last year, according to real estate consultancy ValuStrat. The average price for a villa \u2014 the local term for any freestanding home \u2014 exceeded $2.7 million for the first time in a decade. Rises in premium apartments are close behind with locations in Palm Jumeirah, a man-made archipelago jutting out into the Persian Sea, already surpassing 2014 peaks.<\/p>\n Tariq Shah, the head of sales at Pat & Co., a brokerage firm that deals in high-end properties, said the demand from his clientele seeking to buy has risen exponentially. \u201cThe demand for luxury is way above the expectation,\u201d Shah told the AP.<\/p>\n Meanwhile, Dubai International Airport \u2014\u00a0the world\u2019s busiest for international travel<\/a>\u00a0\u2014 saw a record 44.9 million travelers in the first half of this year. Dubai\u00a0plans to move operations<\/a>\u00a0to a nearly $35 billion new airport in the next decade.<\/p>\n \u201cWe are heading for a forecast number for the balance of the year of 91.8 million passengers through DXB, which is again another record for us,\u201d\u00a0Dubai Airports CEO Paul Griffiths<\/a>\u00a0told the AP.<\/p>\n Some 9.3 million tourists visited the global hub through the first half of the year, beating pre-pandemic heights, according to research from the Dubai government-owned bank Emirates NBD.<\/p>\n The city state\u2019s population has grown from 3.2 million in 2018 to nearly 3.7 million in 2024, with an additional 1.1 million who temporarily live in the city or commute there for work each day. The hereditary monarchy seeks to increase Dubai\u2019s population to 5.8 million by 2040.<\/p>\n But some analysts are asking just how long the record-breaking upswing can last.<\/p>\n Some warned that an oversupply of housing could eventually slow the market if demand does not keep pace.<\/p>\n \u201cFrom 2025 and 2026, there will be a vast new supply of new units that started construction back in 2021,\u201d Tatjana Lescova, an analyst at S&P Global, told the AP. \u201cIt is by that time that essentially we think the new supply will not be fully absorbed by the market, and this could create the cyclical slowdown.\u201d<\/p>\n Developers have already completed over 6,000 housing units through the first half of the year, and are expected to finish building another 20,000 by the end of the year, according to the state-run WAM news agency.<\/p>\n \u201cThey are big numbers, but they\u2019re being absorbed,\u201d said Property Monitor\u2019s Jochinke. \u201cPeople are buying them.\u201d<\/p>\n<\/div>\nRecommended Newsletter: <\/strong>CEO Daily provides key context for the news leaders need to know from across the world of business. Every weekday morning, more than 125,000 readers trust CEO Daily for insights about\u2013and from inside\u2013the C-suite. Subscribe Now<\/a>.<\/div>\n