Dubai: Every year, billions of dirhams are generated from the sales of luxurious flats in Dubai. But where does the money come from and who are the wealthy buyers?

According to Christie’s International Real Estate, there are more high-net-worth individuals (HNWIs) snapping up prime property in Dubai than in traditional hotspots in the United States or United Kingdom.

In fact, Dubai ranks as the most popular city for second home purchases among global HNWIs, who accounted for the majority of luxury sales last year.

Christie’s surveyed more than 80 markets worldwide to find out where the ultra-rich individuals buy posh residences. Among the world's top cities for prime real estate, Dubai ranked first, with 75 per cent of prime property buyers hailing overseas – compared to 44 per cent in London and 40 per cent in Miami.

According to Joachim Wrang-Widen, regional vice president for Christie’s International Real Estate, Dubai’s luxury property buyers come primarily from the UK, Germany, Russia and CIS (Commonwealth of Independent States), and the Gulf region.

These discerning affluent buyers typically spend Dh11 million to Dh18 million ($3-5 million) on a prime luxury apartment in Dubai.

“The price varies with locations, size and who the developer is.  The $3-5 million range is quite representative for small upper-market apartments which will include luxury. For proper-sized luxury, the market starts above 10,” Wrang-Widen told Gulf News.

He said the foreign wealthy buyers have been attracted by Dubai’s dynamism, tax-free regime, business- and investor-friendly environment, “air transport accessibility” and leisure options.

“For international buyers, the opportunity of acquiring real estate in a market that is characterised by dynamism and an extremely large degree of [foreign population] without any income tax or capital tax being levied contributes to international purchasers viewing the Dubai market favourably,” Wrang-Widen told Gulf News.

“Tax, while important, is not making a market on its own if the underlying rationale for investing is not present. Dubai satisfies the underlying criteria by being business- and investor-friendly,” he said.

“Geographically [Dubai is] almost equidistant between Asia and Europe. The Expo 2020 has definitely increased the level of interest following a slight plateauing of the market earlier.”

Christie’s latest “Luxury Defined” report, however, warned that property markets that rely heavily on foreign investors are “susceptible to the economic ebbs and flows” of other countries.

Punta del Este in Uruguay, whose prime property sales are also dominated by foreign buyers, recorded a downturn in luxury sales volume recently, primarily as a result of the “precipitous decline” of Argentina’s economy in 2014.

According to the Dubai Land Department, foreigners spent Dh12 billion on property purchases in Dubai during the first quarter of 2015.

Across the globe, wealthy prime property buyers spend at least $2 million (Dh7.3 million) on average on luxury homes. The most expensive price entry point for luxury property is offered in Beverly Hills, where the price tags start at $8 million.