Private Property in Dubai: Real Estate Market Rebounding
By Space Coast Daily // September 20, 2021
The top-class residential property market in Dubai seems to be experiencing a great and busy revival these days. Prices for private property are recently rising to an astonishing rate, especially in luxury residential complexes, like the Royal Atlantis Resort & Residences located on the fabulous island of Palm Jumeirah.
In this article, we shall review the most significant factors accounting for the city’s growing popularity and try to understand why potential investors are, literally, queueing for a share in its lucrative real estate sector.
Quality of Living in Dubai
Dubai is one of the most exotic and wealthiest cities on the planet. Fascinated with size and prominence, it offers its residents and visitors the highest tower in the world, the largest music fountain in the world, and even the biggest shopping mall in the world.
There are many beautiful parks and exotic beaches, ski resorts, racecourses, and cableways in the city. Nearly one hundred malls in the city centre have made Dubai the most prominent shopping destination in the Middle East.
On the other hand, the majority of its citizens live in cozy residential areas with quiet narrow lanes and a peaceful traditional lifestyle.
Dubai also ranks high on the UN’s Human Development Index. Its population enjoys one of the lowest crime rates in the world, an advanced healthcare system, a comparatively high level of education, high income, a well-developed infrastructure, and a stable currency.
Private Property Market in Dubai
The United Arab Emirates have always been an attractive destination for high-level investors in the luxury real estate sector, even during the global economic crises of the last couple of decades.
Luxury residential projects in the country continue to provide a high standard of living and numerous options for potential investors to choose from, such as apartments, duplexes, penthouses, and even bare plots of land where one can build a house of one’s own design from scratch.
On the other hand, the government’s steps towards overcoming the turndown due to the COVID-19 pandemic seem to have been successful so far. That, in turn, has had a positive effect on the real estate market, especially in Dubai.
The main factors accounting for the solid rebounding of the property market in Dubai include:
■ Attractive mortgage and rental interest rates
■ Expo 2020
■ Lifting of the tourist restrictions
■ More lenient visa regulations
■ Simplified procedures for the foreign enterprises in the country
■ The government’s unyielding attempts at increasing the standard and quality of living in the city
Real Estate Sector Revival in Figures
The number of private property purchase transactions has already reached 20 thousand this year, and it has been the highest for the last seven years.
The sales of luxury residential property have grown by more than 130% comparing to last year and have, in fact, hit an all-time record.
Judging by the increase in the annual capital gains, the most popular locations include Palm Jumeirah and Business Bay, with average property prices of 36 million AED and 29 million AED, respectively.
Mortgage Availability in the UAE
In addition, various financial resources, such as mortgage loans, have become significantly more accessible to nationals and foreigners alike. As a result, the mortgage volume in 2021 has been 77% higher than last year, reaching over 12,000 transactions, which is the highest since 2017.
It is even possible to apply for and receive a mortgage loan from the local banks before you have selected a property to purchase, which allows you to browse the real estate market with the money available for an immediate purchase transaction.
Benefits of Investing in Private Property in Dubai
The city continues to hold a high status for potential large-scale investors, both local and foreign alike.
There are several reasons to consider investing in Dubai’s real estate sector:
- There is no income tax on rental yields and capital appreciation.
- One may expect up to 10% rental yields, which is one of the most lucrative in the world.
- The luxury space, either per $1 or a square metre, compares favourably with those in other large cities in the world.
- The rental interest rates range from three to five per cent with up to 25 years of repayment.
- The city authorities provide a sufficiently easy and transparent regulation system to attract foreign direct investments (FDI).
The real estate market in the United Arab Emirates offers excellent opportunities for potentially lucrative investments. And the high standard and quality of living in the country make it an attractive option for relocation or at least for purchasing a private property to visit on holidays.
Our tentative conclusion is that the luxury residential property in the country generally, and especially in Dubai, will continue to be in high demand, attracting increasing numbers of investors, local and foreign alike. And the current favourable conditions for purchasing real estate in Dubai make it a good idea to invest in it now.