Dubai offers good value for high-end consumers among global cities, particularly if they are looking to purchase luxury property, according to a new study from Swiss bank Julius Baer.
The emirate ranked 17th overall out of 28 cities in the bank's inaugural Global Wealth and Lifestyle Report 2020, which tracked the price trends of 20 luxury goods and services. Dubai ranked 23rd within the luxury property segment.
“Luxury property, previously good value, is now exceptionally good value, as high levels of supply have seen prices fall consistently, by over a fifth in the past five years,” the report said.
Other cities with cheaper average high-end property listings are Johannesburg, Mexico City, Manila, Rio de Janeiro and Jakarta.
The survey covered ten cities in Asia Pacific, 10 in Europe, six in the Americas, Dubai in the Middle East and Johannesburg in Africa. Overall it found Asia to be the costliest region — with Hong Kong ranking as the world's most expensive city, followed by Shanghai, Tokyo, New York and Singapore. The most affordable city for luxury is Mumbai, followed by Johannesburg, Frankfurt, Istanbul and Barcelona.
“Contrary to popular belief, Europe is the most affordable continent, primarily because luxury items are not heavily taxed as elsewhere in the world especially Asia,” said Diego Wuergler, head of investment advisory at Julius Baer, which manages assets of 422 billion Swiss francs (Dh1.6 trillion) as of November.
Dubai is also quite affordable for luxury travel. The emirate ranked 26th most expensive city for a business-class flight to London or New York and 27th for the cost of a wedding banquet for 400 people at a top hotel.
However, the emirate is more expensive for a ladies’ purse and a suite at a five-star hotel, compared to other cities.
Beauty services, measured by the cost of Botox for crow’s feet, came in 8th, while laser eye surgery and a personal trainer came in 9th. Meanwhile, cars, ladies’ shoes and fine dining are priced averagely compared to other cities that were surveyed.
“Dubai offers one of the most affordable luxury residential properties compared to other markets globally in addition to cars and wedding banquets thus offering good value for consumers,” Mr Wuergler said. “On the other hand, services are on the more expensive side — including wellness services — and expectations are for this to change as more players enter the market.”
The city’s high cost of wellness services is a “possible consequence of its reputation for luxury breaks”, the report said. However, prices may become more competitive as new wellness themed resorts are scheduled to open in the coming years.
Elsewhere, Asia is the most expensive region for residential property and luxury cars. Hong Kong ranks above the 90th percentile globally for property, beauty services, fine dining, business class flights and lawyer fees. Mumbai, however, offers value across almost all goods and services.
In Europe, London is the priciest city with Zurich a close second, driven by high service charges and costly hotels and fine dining. Barcelona’s luxury property market, ranked 22nd, remains relatively inexpensive.
New York led the rankings in North America, being the most expensive city globally for a lawyer and a wedding banquet, while Vancouver is the cheapest globally for a luxury car and fine dining. In South America, prime property is a bargain in Rio de Janeiro and Mexico City, but other goods and services are more highly priced.
Julius Baer began tracking the cost of consuming luxury through its Wealth Report Asia in 2011. This year, it expanded the scope of the report to showcase "trends in high-end consumption around the world, which are of relevance to our clients", said Rajesh Manwani, Julius Baer's head of markets and wealth management solutions Asia Pacific.
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[ Inside the Dh45m Cayan Tower penthouse in Dubai ]
