Dubai: European buyers surpass Indians, Pakistanis in new property project
17 April 2023, Khaleej Times
European property buyers continue to flock to Dubai, surpassing Asian investors in some of the new projects attracted by better rates and the impact of the Ukraine crisis on the European economy.
Most of these property developers are coming from Western European countries such as Switzerland, Germany, France and the UK to cash in on higher returns in terms of rentals and capital appreciation.
Traditionally, Indians, Pakistani, British and Gulf nationals have been the dominant investors in the local property, along with the UAE citizens, accounting for a lion’s share of the total investment. Of late, Russians, have upped the ante, investing billions of dollars in the local real estate market for a safe investment.
Moreover, strong foreign fund inflows in the post-pandemic period have pushed the emirate’s property market to nearly nine-year of 2014’s peak in March.
The Dubai-based Samana Developers said it received more buyers from France and Europe than the recent trend of Russians and Chinese, British, Pakistanis and Indians in past and this new trend is prevalent in the entire real estate market.
“Yes, this is very true. Of late, we have witnessed an increase in European property buyers investing in UAE. This is an extremely positive trend as it widens the sales scope, our audience as well as our reach. While previously real estate market investors were from the subcontinent and the UK, European buyers today are now actively investing too,” says Ayman Youssef, vice-president, Coldwell Banker UAE.
He added that property buyers primarily are coming from Germany, France and Switzerland.
Why Europeans are investing?
Najmeh Jafari, general manager of Samana Developers, said the Europeans who are mainly investing in properties here are from France, Germany, the UK, the Netherlands, Sweden, Switzerland, Austria, Belgium, and Norway.
Jafari added that more Europeans are investing in Dubai real estate due to multiple factors such as low tax rate benefits, luxurious and attractive lifestyle, more economical property prices and higher returns, ease of doing business, political and economic stability and safety.
“When you look at all these factors, Dubai is an attractive destination for all those Europeans who want to buy a property and start a business. These are the reasons the number of investors from Europe is rising every day,” she added.
Ayman Youssef added that the besides the positive economic situation in the UAE compared to the rest of the world, there are a number of factors that encourage European investors to invest in Dubai.
“The UAE property market has managed to maintain attractive prices with higher yield/return per unit as compared to most countries in Europe. Today one can get up to 8 per cent returns which is quite high compared to what any European country can offer. The UAE bags first place which encourages people to invest in property to make it their permanent stay. Also, the Golden Visa, 100 per cent ownership right, business opportunities and other factors are surely encouraging people to invest more in the emirate,” Youssef added.
How much are they investing?
Najmeh Jafari observed that there are two different categories of investors from Europe – one that always focuses on high-end residential properties and loves to live in Downtown, Dubai Marina and Palm Jumeirah and the second are pure investors.
“Some love to live in Downtown, Dubai Marina or Palm Jumeirah. The one that holds high-ticket price, say, somewhere between Dh4 million to Dh80 million or even higher,” she said, adding that Europeans who purchase assets for investment purposes range between $0.5 million (Dh1.83 million) to $2 million (Dh7.34 million)
“They basically like to go for a good payment plan to buy property, which makes it easier for them to pay. The end-users, on the other hand, invest as much as they want. Therefore, two different categories of European investors have different requirements – end-users settling in Dubai with families is a different story than for those who invest just transfer and safeguard their money,” she added.