Property in Dubai attract tourists from all over the world. This city impresses with its modern architecture, luxury and incredible opportunities. As in many other international financial centers, the purchase of real estate in Dubai is one of the most sought-after capital investments. The emirate is famous not only for luxury apartments, but also for premium villas, penthouses and houses. In addition to residential real estate, you can buy premises for an office or business. In this article, we will look at why buying a property in this emirate can be a profitable investment.
If you are still thinking about whether to buy an apartment, villa or other object, we recommend watching a video with an overview of the Dubai real estate market for 2023:
Next, we will look at some of the factors that can change the way you think about buying property in Dubai.
Is Dubai the right place to buy property?
Definitely yes! Buying real estate in Dubai is a profitable investment in the future. It worth to buy property in 2023. The emirate is central to the UAE and attracts millions of tourists and investors from all over the world. One of the key questions that many people ask themselves is: is it worth buying a home in Dubai? Before you decide to buy an apartment in Dubai, it is important to answer the question: "Do I need it?". The answer to this question depends on your individual goals and circumstances.
Buying a property is a big decision, so assessing factors related to United Arab Emirates is a necessary part of the decision. Important factors to consider are the stability of the economy, the legal system, business opportunities, tax policy, and the availability of financial services. It is also important to consider personal factors such as intended use of the property, length of stay, and financial capacity.
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Benefits of buying Dubai property:
- Low taxes. Dubai offers an attractive tax policy with no tax on income and sales for most investors;
- Favorable business climate. Flexible adjustment, highly skilled workforce and access to international markets make Dubai an attractive place to do business;
- Developed infrastructure. International airports, high-class schools, medical facilities and modern shopping centers make Dubai a convenient place to live;
- High potential for real estate price growth. With the city's rapid development, rising demand and limited land resources, property prices in Dubai have the potential to rise. This can make the purchase of property in Dubai an attractive investment that allows you to make a profit in the future;
- Variety of housing types and luxury facilities. Dubai offers a wide range of real estate, from luxury villas and apartments in skyscrapers to cozy family houses and townhouses. Regardless of your preferences and budget, you will be able to find the right accommodation option to suit your needs and lifestyle.
In addition to the main features of the real estate market, Dubai is known for the standard of living of the population and the variety of services offered. There is work for most types of professions in the city. Here you can also visit dozens of the most popular UAE attractions, as well as get a good education from graduates.
Where is the best place to buy a property in Dubai
Dubai districts differ from each other in terms of transport accessibility, population and many other factors. Choosing an area to buy an apartment in this emirate can be tricky given the abundance of options. However, there are a few areas that are particularly popular with shoppers. For example, Downtown Dubai offers luxurious apartments overlooking the iconic Burj Khalifa and the dancing fountain show. Marina and Jumeirah Beach Residence (JBR) are popular beach areas where you can find beautiful apartments with great sea views.
Which developer should I buy property in Dubai
The success of your investment activity directly depends on how responsibly you approach the issue of choosing a developer. Buying a property from a developer in Dubai is a profitable and reliable way to save capital, provided that you have chosen a quality company with a good business reputation and the presence of successfully implemented projects.
The more reliable contractor you choose, the less likely it is to delay delivery or receive poor quality property. We recommend that you read the list of Top developers in Dubai, then select several options and check each holding. Самые известные builders - это Emaar, Sobha, Damac, Azizi, Nakheel, Danube, Meraas, Omniyat and LIV. Established companies value the commitment of investors and perform all work in accordance with established construction standards and contracts. Check the builder's reputation, experience in the market and the quality of previous projects. Inspect the object personally and study all the documents related to the transaction. It is also important to pay attention to the terms of payment and guarantees offered by the developer.
Who buys real estate in Dubai?
Apartments, villas, penthouses and other types of property in the emirate are acquired by people from all over the world, as the city is included in the TOP 50 best places to live according to Nonews magazine. Citizens of the UAE invest in new facilities not only at the time of development, but also in buildings that are being prepared for delivery. Among the investors there are also citizens from Russia, the USA, Great Britain, India, Turkey, Egypt, Germany, etc.
According to the Frank RG agency, in 2022, only Russians purchased real estate in Dubai for more than USD 890 000 000 or AED 32 200 000 000. The reason for this is the massive relocation of Russian citizens. Next, we will consider other reasons for buying real estate in this city for foreigners.
Why people buy real estate in Dubai
- 1. Residency - Buying an apartment for more than $205 000 / AED 750 000 in Dubai can get you a resident status. This is an analogue of a residence permit, with which you get access to medicine, education, banking services, and most importantly, the opportunity to legally stay in the country for 3 years. In this case, you can apply for residency for a family.
- 2. Return on investment - So far, no investment gives such a return as investment in real estate in Dubai. And the market is not yet overheated - this year Knight Frank predicts a price increase of 13.5%. Some investors receive a yield of around 50% per annum in dollars (look for a case below). It must be admitted that this will not always be the case, Russian investors understand this and are in a hurry to use the opportunity.
- 3. Relative affordability of real estate prices - The emirate remains one of the most affordable in the luxury real estate market. Conventionally, for 1 million dollars in the most prestigious area of Dubai you will buy four times more squares than in New York or Singapore. Therefore, people with capital choose the UAE, and not other countries.
Another important factor is tax incentives. As we described above, in the emirates individuals do not pay income tax, as well as tax on luxury, gifts, inheritance, etc. Very loyal tax legislation attracts investors from all over the world. However, there is a commission for the sale and purchase of apartments in the amount of 1% of the total cost.
What attracts investors to real estate in Dubai?
Investors perceive Dubai as a safe haven against the backdrop of an unstable geopolitical and economic situation in the world. People are attracted by the ease of doing business, the minimum of taxes, and the liberal visa policy. The most popular requests among potential buyers are to quickly enter the object and earn a good percentage on the invested amount due to installments. The advantage of the local market is that many developers offer interest-free installments. Thanks to this, you can use a short-term strategy for investing:
- 1. Contribution 20% (AED 780 000) of the price of the apartment (AED 3 900 000) + 4% land tax (AED 156 000). Property in MJL, which is close to Burj Al Arab.
- 2. We are waiting for a price increase - from 3 months. We pay every month at AED 16 250 with a period of up to 20 years.
- 3. We resell the property to another buyer at a premium.
Having invested AED 830 000 in the object, after 3 months he resold it for more and earned AED 300 000 on top. It turned out to be 36% of the profit from the invested funds in UAE dirhams. Of course, such profitability is not possible at all objects and not with all transactions. There are several factors here:
- 2 bedroom apartment in a very popular project - Rahaal, Madinat Jumeirah Living (geographical center of the city, cool location by the sea), community Umm Suqeim 3.
- A well-known developer who sells the project through a lottery - buying in this project means winning a lucky ticket.
- The apartments bought the whole floor from the developer thanks to connections and 10 years of experience in the market.
There are other ways to make money in the Dubai market: long-term investments and rental business. International investors are also attracted by the rental business. They create investment portfolios that generate an income of 10-16% per annum in dollars. That's one of the highest dollar rental incomes in the world, and you don't pay taxes on that income at all. Again, you need to carefully choose the object, not to miss everything. This is not the Klondike of the real estate world, but an ordinary growing market where smart investors can make good money.
Conclusion: Is it worth buying property in Dubai
It is important to remember that when making a decision to buy a property, you need to take into account your personal circumstances, budget and goals. It is recommended to turn to professionals and carefully study the real estate market in order to make an informed decision.
In conclusion, the decision to buy a home in Dubai depends on your individual goals and circumstances. Evaluate all the advantages and disadvantages, study the real estate market and consult with professionals before making a decision. Remember that buying property is a long-term investment, so weigh all the factors carefully before making your final decision.