(Bloomberg) -- Hundreds of buyers queued overnight outside a Dubai-based developer’s office for a chance to snap up luxury waterfront homes, in the latest sign of the frenzy gripping one of the world’s hottest property markets. 

Government-backed Nakheel PJSC sold all houses on offer in the first two phases at the Bay Villas development within hours. In all, the project on Dubai Islands will feature more than 500 homes, with prices starting at $1.2 million apiece. The most expensive properties will cost upwards of $4 million. 

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Dubai has seen a surge in demand for property over the past couple years, aided by an influx of a people from around the world. That’s helped the city reverse a years-long slump — prices are closing in on records, despite mortgage rates hovering at the highest levels in two decades. 

The sustained strength is reflected in new launches, some of which have sold out rapidly. Nakheel, best known as the developer of Dubai’s artificial palm-shaped islands, last year launched a project that saw buyers queue up in 100° Fahrenheit (38° Celsius) heat for $5 million homes. 

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The surge in demand caps a turnaround for Nakheel, which was at the center of a property crash in 2009 that nearly bankrupted Dubai, but has since consolidated operations and cut costs. 

For Nakheel’s latest project, the long line of brokers and investors outside its sales office started to form overnight, prompting police to step in and patrol cars were stationed in the area. Only brokers who received tokens were allowed to return in the morning. 

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