It’s clear to most around the world now that Dubai has become a destination not just of the future, but for right now. And it’s happened within just a few decades, with huge building and infrastructure projects all happening simultaneously to deliver a world-class city capable of standing toe-to-toe with any other metropolis with the aspirations to be seriously considered forward-thinking.
Dubai has benefitted from a clear, inclusive, and comprehensive developmental vision, coupled with world-class real estate projects, and it’s certainly become one of the top choices for property investors from all over the world.
But is Dubai really a safe haven for property investors? To accomplish this status, and to be a viable investment destination, Dubai should be able to present the core indicators of resilience, stability, accessibility, favourable tax treatments and governance.
Let’s see how Dubai matches up in these core areas to discover if it really can be considered a safe haven.
1. Resilience
It is well known that the coronavirus epidemic, especially at its height, slowed down the world economy. Like any other global economic powerhouse, Dubai was also impacted. Dubai didn't lose its attraction as a top choice for investors, though, thanks to the government's swift and decisive response to the Covid-19 outbreak, lucrative investment choices, and a number of government policies and initiatives. Dubai's economy has recovered successfully from the crisis, and everything is now in position for it to continue its development into a city of the future.
These significant figures demonstrate that Dubai's real estate sector is back on track and set for strong growth.
· The Dubai real estate market saw record sales over the past few of years despite the coronavirus pandemic.
· Real estate prices increased by a staggering 60% as of 2021. Additionally, according to real estate specialists, the property market will keep growing through 2023 and beyond. This proves that today is a fantastic moment to invest in real estate in Dubai.
· Compared to other developed real estate markets throughout the world, Dubai's real estate offers higher rental yields. Investors should fairly anticipate a gross rental yield of 5% to 9%.
· Owning a property in Dubai is still less expensive than purchasing one in many other major cities across the world, despite the current spike in real estate prices.
2. Stability
The UAE is regarded as a beacon of peace in the Middle East, despite the turbulence that surrounds it. While KSA, Yemen, Iran, Israel, Iraq – the list goes on – are prime examples of countries in which investment should be approached with the maximum available level of caution, Dubai is politically stable, well regarded amongst all other nations, and extremely safe, which in turn makes it an attractive place to invest.
3. Accessibility
Gaining a residence visa in Dubai is relatively easy for real estate investors. People who invest in property in Dubai can attain a residence visa (subject to certain conditions). It breaks down as follows:
· If you buy a property worth more than AED 1 million, you might be eligible for a 3-year residency visa
· Those who invest in a property worth more than AED 5 million might be eligible for a 5-year residency visa
· Real estate investors buying a property worth more than AED 10 million might be able to get a 10-year residency visa
It is recommended that you always check the official immigration authority website in Dubai for the latest requirements.
4. Favourable tax conditions
The virtual absence of property taxes and stamp duties position Dubai quite well to be considered as a city that benefits from favourable tax conditions. If, as an investor, you are also planning to live and work in the city, you will also benefit from zero income tax, which is nice. These tax breaks are not usually applicable in most global real estate markets.
5. Government
As anyone who has studied Dubai policy making or lived there at any point, it will come as a refreshing change to see a government that seems to want its people, its residents, to prosper and flourish. It’s very rare. Business growth in particular is a priority for the UAE government, and so a series of innovative approaches have been adopted to try to make Dubai more attractive for investors. Some of the investor-friendly policies introduced by the government include:
· 100% foreign ownership of business in the majority of sectors
· The 5-year retirement visa
· The long-term visas for investors
These initiatives have served to increase confidence among foreign investors. Dubai’s luxury real estate sector, which overtook London, New York and Paris in terms of market activity and transaction value for the first time this year, has been a key beneficiary of this unique approach to governing a nation and a city.
The government is committed to digital transformation within the real estate sector, and Dubai Land Department launched the Real Estate Self Transaction (REST) in 2018. The REST platform covers all real estate transactions, and removes many of the limitations of a non-digitised transaction process. For example, thanks to REST, property owners can now buy and sell properties from any part of the world. It allows customers to manage all aspects involved in a real estate transaction online, saving them both time and effort.
Contact us today to discuss options for entering this market.