With the city recording exponential growth in almost every sector, Dubai has become quite appealing to entrepreneurs and investors alike. But besides serving as a haven for business people, it is also a popular cosmopolitan destination for entertainment and shopping.
Known as the most populous city in the United Arab Emirates, more and more people are attracted to its location and the harmonious contrast of its diversified communities.
This has led to the growth of the city’s real estate market, leading to a whopping AED 72.5 billion worth of transactions during the first half of 2020. According to the Dubai Land Department (DLD), this development is a clear sign that Dubai remains the top choice for property investors.
With this pace expected to continue for years to come, it comes as no surprise that many others are looking to invest their money somewhere it can grow. Want to know why?
Here are the seven reasons luxury real estate in Dubai makes an excellent investment:
While more people have settled in Dubai for the long term, the city’s tourism sector still flourishes. As one of the world’s most popular tourist destinations, Dubai continues to fascinate people from different countries, earning the right to be called the jewel of the desert.
Apart from the natural desert destinations, the city has several other attractions, including world-class architectural gems like the Palm Jumeirah and Burj Khalifa, the tallest building in the world. It is also home to many internationally renowned hotels that present no shortage of wonderful experiences.
A visit to Dubai also gives tourists a chance to attend several arts, cultural, and sporting festivals, including the following:
- Dubai International Film Festival
- Dubai Jazz Festival
- Dubai Golf Desert Classic
- Formula 1 Race (in Abu Dhabi)
- Rugby Sevens
- Dubai World Cup of Horse Racing
- International cricket matches
With all these destinations and events attracting visitors to the city, lodging and other accommodation properties will surely have a steady stream of income.
One of the primary considerations you must think about in real estate investment is the economy, especially if you’re venturing into a foreign country. The stability of the economy will greatly affect how well businesses like rental properties perform in the market.
Fortunately, Dubai has already gained its momentum for continuous economic growth in the next couple of years. Data and statistics show that Dubai has the best planning and economic growth across the MENA region, even as other cities struggle with losses because of the pandemic.
Call it geographical luck, but whatever the case, it doesn’t change the fact that Dubai (and the entire United Arab Emirates) sits in one of the most strategic spots on the world map.
Located roughly six hours away (by plane) to and from most major Eastern and Western cities, it serves as a convenient waypoint for people travelling in both directions. This also makes Dubai an excellent business hub for local companies looking to expand their reach across the globe.
Dubai made sure to take advantage of this with the Dubai International Airport. Banking on its location, the airport caters to a whopping 8.2 million passengers annually.
Like in tourism, people coming to the city for business and travel means revenue for real estate investors, particularly those with short-term or vacation rentals.
Aside from providing opportunities to earn, Dubai also offers real estate investors substantial returns on their investment.
Besides capital appreciation that can be attained after a property sale or a release of a sizable equity mortgage, real estate ROI also comes in the form of rental fees. Unlike the former, the latter matures much more quickly since most rental properties get paid every month.
On top of that, revenue is guaranteed as the population in Dubai continues to grow. Thanks to its popularity among tourists, workers, and expatriates looking for a better place to live in, the demand for Dubai apartments and other real estate properties – both rental and for sale – remains healthy. Using a mortgage calculator can provide you a clearer picture of the financial feasibilities of a property you’re interested in.
Attractive tax situation and policies
Want to know another reason why doing business in Dubai is quite appealing? It’s primarily due to its attractive tax situation.
Unlike other nations, Dubai doesn’t impose capital gains tax, withholding tax, and personal income taxes for investors.
Moreover, a law was implemented in 2018 that allows foreign company ownership. This was then followed by the introduction of a 10-year residency visa specifically tailored for specialists and investors, making the place a lot more attractive for people looking to invest and work in the City of Gold.
Transparent and regulated real estate market
Besides profit, real estate investors must also look into how well the market is regulated before diving in to ensure that they’re putting their money is in a place where it is protected.
In this aspect, Dubai passes with flying colours, as it has one of the best-regulated real estate markets in the Gulf Cooperation Council (GCC). This is because the government has adopted measures for investors’ vested interests, such as:
- a rental cap;
- escrow regulation;
- rental dispute settlement centre; and
- a rental increase calculator.
This is on top of the already-strong framework of regulations that are designed to ensure the safety of your investment in Dubai.
Furthermore, the DLD – along with the Real Estate Regulatory Authority (RERA) – keeps a close eye on the property market to ensure that property developers deliver their promises without delay.
Overall safety and security
Overall safety and security are two more major concerns investors have when deciding on a place to invest in. Dubai doesn’t fall short in this aspect, as it is considered one of the safest cities worldwide.
According to a survey from crowd-sourced global database Numbeo, Dubai holds seventh place in terms of overall safety in the world. Along with neighbours Abu Dhabi and Sharjah, Dubai’s 16.98 perceived crime rate is one of the lowest worldwide. It also gained a high score in terms of the safety index, with a whopping 83.02 score.
Invest in Dubai for your financial freedom
Investing in real estate is one of the best ways to attain financial freedom, but only if you do it the right way and in the right market.
Seek the best property investments in Dubai, and your chances of success will surely grow along with the city’s economy.