There is no news that Dubai has been ranked the best place in the world to invest, but what makes this future-forward city so appealing? To quell all doubts, I have put together a compelling blueprint of why any investor should acknowledge the exceptional value of Dubai property market:
1. Attractive prices on an international level
Believe it or not, Dubai is relatively cheap in comparison with other major metropolitan areas like London or New York. A recent study published by Savills showed major differences in value optimized pricing, for example a two-bedroom apartment located in Emaar’s Standpoint towers, situated in close proximity to Burj Khalifa and offering world-class amenities will cost you Dhs165,000 a year, while the same amount in a similar central location in London, will set you back to a small spaced studio.
2. Tax-free environment and Foreign Ownership
In March 2006, the government of Dubai implemented a law meant to encourage foreign ownership in Dubai property and to boost the real estate market.
3. Expo 2020
With an international audience of 25 million visitors and bringing together more than 180 nations, Expo 2020 makes up for one of the most compelling reasons to invest in the Dubai real estate market. There is no doubt that Dubai will make a show out of the most anticipated event in the recent years and plans to invest 2$ to 4$ billion to develop the infrastructure around the hosting area.
4. Shortage in supply
With a 7% population growth and Expo 2020 creating 277,000 new jobs, Dubai must keep up with a demand of 75,000 new properties each year. According to the Damac Properties Chairman, Mr. Hussain Sajwani, only 10,000 new units were expected to be delivered in 2016, “driving the market back into positive pricing growth territory” by the second half of 2017.
5. Ease of investment
UAE achieved the performance of being ranked 1st in the Arab world for a 4th year in a row, in a report released by The World Bank on the “Ease of doing business for the year of 2017”. The World Bank report, which measures the performance of 189 states in facilitating doing business for investors, placed UAE 26th on a global scale and first on a regional scale.
6. Buy vs. Rent
With the upcoming Expo 2020 and the expectation of thousands of new arriving professionals striving to set roots in Dubai, the city has experienced a pressure and a high demand to provide and expand the affordable housing sector. Nowadays, the total cost of homeownership is less than the total cost of renting a similar property in Dubai.
In its efforts to reduce to the minimum its dependency on oil, the emirate of Dubai has built the tourism and hospitality sector at a fast pace. With more than 10 million guests in 2016, Dubai has become an international hub for world-class tourism and magnificent tailored destinations. However, Dubai has no intention to stop here: more than 20 million visitors are expected to travel annually to Dubai by 2020.
8. Risk adjusted returns
A key feature of real estate investment is the significant proportion of total return, accruing from rental income over the long term. This helps reduce volatility as investments that rely more on income return, tend to be less volatile than those that rely more on capital value return. Dubai offers world’s highest rental yield, outstanding India, Hong Kong or London.
9. Investments incentives
In its aim to lure international investors and stimulate the market, Dubai has no shortage of very attractive investments incentives, as both the government and the major real estate players are in a continuous joint effort to build a free-market and a mutually-beneficial business-friendly platform.
10. Diversity and multiple choices of investment opportunities
Dubai is home for more than 200 different nationalities, and much like its diverse population, Dubai has a huge area of choice when it comes to locations and developers. From worldwide renowned property developers like Emaar, Damac, or Nakheel to top class locations like Palm Jumeirah, Downtown Dubai or DWC, savvy investors have a sky limit wide range of possibilities.