DUBAI: With rents soaring and properties selling fast, the expatriate hub of Dubai is in the throes of a housing boom bolstered by rich emigres that has buoyed investors and burdened tenants.

Dubai, renowned for its towering skyscrapers and ultra-luxury villas, saw record real estate transactions in 2022, largely due to the influx of wealthy investors — especially from Russia.

That helped to rake in more than $140 billion last year, marking a 76 percent annual rise in property market transactions for the Gulf city state, based on the latest official figures.

“The market in the last year has massively changed — it is great for landlords, but it’s not so good for tenants,” said Jacob Fletcher of brokerage firm Betterhomes.

While it may not be as rich in oil as the UAE capital Abu Dhabi, Dubai lures expatriates with tax incentives, a lush lifestyle and cheap services provided by low-wage laborers from Asia, Africa and the Middle East.

In upscale Dubai neighborhoods, where properties sell for more than $10 million, the 219 sales recorded in 2022 were “more than the total recorded between 2010 and 2020”, said real estate consultancy Knight Frank.

Property prices in these prime locations jumped by 44 percent in 2022 compared with the year before, it said.

“The luxury market in Dubai was the fastest growing in the world but remains cheaper than main big cities,” said Faisal Durrani, head of Middle East research at Knight Frank.

Rich Russians

Over a decade ago, Dubai’s property market slumped due to a financial crisis.

The city is now a magnet for ultra-rich investors, including Russians fleeing the impact of sanctions after their country’s invasion of Ukraine.

Russians were the biggest foreign buyers on Dubai’s property market last year, according to Betterhomes.

British, Indian, Italian and French nationals are also among the top investors, the brokerage firm says.

Entrepreneurs, business executives, bankers and celebrities are among the wild assortment of clients rushing to clinch a home in one of the first cities to open up after the Covid-19 pandemic.

“We’re seeing a lot of customers from Europe, who are wanting to move here and who are wanting to send their kids to school here, start business here,” said Farhad Azizi, who heads property development firm Azizi Developments.

“So, we were seeing a lot of a lot of new clientele, and they’ve kept the market very busy.”

Most of Dubai’s population of more than 3.5 million is comprised of expatriates.

But the housing boom has made it more expensive for them to live in the city.

“There’s about a 20 percent increase in the rental market this year compared to last year alone,” said Fletcher of Betterhomes.

“The people that have lived here especially for a while are very not happy with how high the prices have gone.”

‘Take the hit’

The real estate sector accounts for about a third of Dubai’s economy.

The city’s residents are used to volatility on the property market, with saw prices plummeting during the 2009 financial crisis as well as the pandemic.

With inflation spiraling worldwide, the rapid rise in rental prices in recent months has sparked alarm for many.

“The market is so insane. It’s so expensive,” said a Western expatriate who has lived in Dubai with her husband and son for five years.

The family must find a new home because their landlord has decided to sell the apartment.

“The market is very, very different. So, we are going to have to pay for something smaller and further out,” she told AFP on condition of anonymity.

Social media networks are buzzing with disgruntled tenants who are locked in disputes with landlords over rental prices.

“What can we do? We’ve got to move so we have to take the hit,” the expatriate said.