Investing in property and possessions is a remarkable way to generate income and build wealth. However, any investment comes with a certain amount of risk involved. If you’re looking for a great way to maximize return and minimize risk on your investments, then real estate is one of the safest, smartest investments you can make. And one of the best real estate markets in the world in terms of the highest potential returns is located in Dubai.
The COVID-19 pandemic has taken a negative toll on the economy in many ways, and many investors are struggling to know where to put their money. In the face of this present state of uncertainty, there has perhaps never been a better time to invest in Dubai.
With prices of many items declining in recent years across the UAE, there are many opportunities to shop for assets in Dubai at a cheaper price. And as any investor knows, shopping low and selling high is a wise course of action for achieving maximum returns. Purchasing a residence in Dubai and investing in setting up a business in Dubai at this pivotal moment is really a smart investment opportunity for you.
Here are 5 key reasons why now is a great time to invest in real estate in Dubai:
1. Dubai property prices are low
Dubai property prices were steadily dropping until recently, but we’re now starting to see a positive price swing. This means that housing in Dubai is still available at a comparatively low price, IF you act now. By building your portfolio and getting ahead of the market while Dubai real estate prices are still low, there’s lots of opportunities for you to make some significant gains when the prices go up again and they will.
Investors need to be aware of and consider areas of high demand. For instance, villas in esteemed locations like Jumeriah Golf Estates, Jumeriah Park, Arabian Ranches, and Palm Jumeriah have proven a robust performance in the market. Similarly, homes in Downtown Dubai and Dubai Marina have also shown great resilience over recent quarters, demonstrating their marketplace value.
2. The cost of living in Dubai is reasonable
Another thing to keep in mind is the reasonable cost of living in Dubai. In 2019, an editorial in The National revealed that living in Dubai is 28% less expensive than living in New York. Dubai isn’t even ranked among the 50 most expensive cities to live; it came in ranked 58th on this particular list of major world cities.
And here’s another reason why living in Dubai is more affordable than many may realize. The UAE doesn’t generally collect income tax, so businesses and individuals are able to keep more of the money they earn. It’s also mandated for employers to offer insurance coverage to employees, and this sometimes extends to employee families as well. In terms of housing and schooling, there are many options available at various price points across the Emirate.
Keeping all of this in mind, the cost of living in Dubai is much more reasonable than that of many other world capital cities.
3. The rental market is in decline
As property costs have declined, the Dubai rental market has been in decline as well. Average apartment rents declined around 16% between Q4 2019 and Q4 2020. There’s simply less demand for many rentals in Dubai at present. But with many residences set to hit the market this year, combined with the improved possibility of financial savings on a lease, tenants are presently exploring the condominium marketplace.
That being said, it’s really not a bad time to become a Dubai landlord – far from it, in fact. Property investors would simply be advised to choose larger homes in popular neighborhoods, which are currently being offered at competitive condo prices.
4. Tourism is booming
People from around the world still love to vacation in Dubai, even in the midst of the pandemic. Some of this can be attributed to high vaccination rates within the UAE, along with strict measures in place to ensure the safety of both residents and visitors. There’s a lot to see in Dubai, too. Between the Burj Khalifa, amazing shopping malls, luxurious hotels, and unique destinations like the Palm Jumeirah, it’s no wonder why visitors from around the world are drawn to this opulent city for fun and relaxation, as well as for business.
Domestic travel within the UAE has seen a boost as well. Since the pandemic served to limit international travel, more UAE nationals are spending time visiting the various Emirates, with Dubai remaining at the top of the list for destination choices.
The average length of a hotel guest’s stay increased to 4.2 nights in 2020, and that number has continued to climb thanks to the impact of the World Expo currently being hosted in Dubai through March of 2022. All that being said, there is still untapped potential in the Dubai hotel apartment sector, with plenty of room for growth.
5. Dubai is growing
Statistics show that the UAE’s gross domestic product increased by around 1.35% in 2021, and will grow even further this year. By 2024, the GDP is projected to grow by 2.57%, or more.
The UAE has emerged as the wealthiest sector of the entire Middle East, with Dubai being its richest city. This comes as little surprise, since Dubai is commonly referred to as the “commercial enterprise hub” of the Middle East. The Dubai metropolitan population currently hovers around 3 million, and that number is only expected to climb into the future.
Known for its beautiful architecture, impressive urban engineering, luxury shopping, and white sandy beaches, Dubai has turned out to be a popular hotspot for both UAE nationals and vacationers alike. There’s still untapped potential for development on the shores of Dubai, and since property & housing costs are still relatively low for now this is really a prime time for real estate investments in Dubai.
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Frequently Asked Questions
1. Is it a good time to buy property in Dubai 2022?
Dubai’s assets sector generated a tremendous positive momentum through the 2nd half of 2021, and that trajectory is only expected to continue through 2022. Generous governmental visa reforms and other measures have only served to help buoy the Dubai financial system as far as foreign investment opportunities are concerned.
2. Is it a good idea to invest in Dubai?
Absolutely, and property investment in particular makes a lot of sense in Dubai right now. And owning your own business property here is much more financially beneficial than renting, as is also the case pretty much anywhere else you can think of.
3. What are some of the best investment sectors in Dubai?
Top investment sectors in Dubai include real estate, travel and tourism, and hospitality. Some of the more lucrative areas include the Dubai Marina, Jumeirah Village Circle, Dubailand, Business Bay, and Jumeirah Lake Towers.
4. Do you pay property taxes in Dubai?
Dubai has no property tax. But some areas do have private community fees, comparable to what you would expect with a homeowners association in other countries.
5. Can foreigners buy a house in Dubai?
Yes! In Dubai, foreign ownership is permitted in areas designated as freehold. Foreigners who don’t reside in the UAE and expatriate residents may acquire freehold ownership rights over property without restriction, usufruct rights, or leasehold rights for up to 99 years.