Unlocking potential: Why investors are increasingly excited by property investment in Dubai

Unlocking potential: Why investors are increasingly excited by property investment in Dubai

10 January 2024, Khaleej Times

Dubai, over the last few decades, has evolved into a global hub for business, tourism, and luxury living. As the city continues to undergo rapid development, investors are increasingly turning their attention to its thriving real estate market for a number of reasons.

First, Dubai’s strategic location at the crossroads of Europe, Asia, and Africa makes it a global business and travel hub. The city’s proximity to major emerging markets positions it as an attractive destination for international investors. According to the Dubai Land Department, the real estate market in Dubai has witnessed sustained growth, with a total of 30,545 real estate transactions in 2022, indicating an incredibly vibrant and active market.

Second, Dubai’s commitment to economic diversification has led to the development of a robust and stable economy. The city boasts a business-friendly environment with minimal taxation, making it an ideal destination for foreign investors. According to the International Monetary Fund (IMF), Dubai’s GDP is expected to grow by 3.8 per cent by the end of 2023, showcasing the continued resilience and strength of its economy.

On top of this, Dubai’s population has been steadily increasing due to factors such as expatriate employment opportunities and a high quality of life. According to the Dubai Statistics Center, the city’s population reached 3.5 million in 2022, with an annual growth rate of 6.3 per cent. Additionally, Dubai is a major tourist destination, attracting over 16 million visitors in 2022, as reported by the Dubai Department of Tourism and Commerce Marketing. This combination of a growing population and thriving tourism industry creates a consistent demand for real estate and a booming real estate market.

Dubai is renowned for its futuristic skylines and innovative urban planning. The city continually invests in state-of-the-art infrastructure, including world-class transportation, healthcare, and education facilities. According to a report by the Dubai Statistics Center, the government allocated Dh9.2 billion ($2.5 billion) for infrastructure projects in 2022, underscoring its commitment to creating a world-class living environment. This environment attracts residents and thus creates a strong growth in the real estate market.

One unique aspect of Dubai’s real estate market is the availability of freehold property ownership for expatriates in designated areas. According to the Dubai Land Department, the total value of real estate transactions involving foreign investors reached Dh57.1 billion ($5.5 billion) in 2022, reflecting the increasing interest and confidence of international buyers in Dubai’s property market. Dubai also offers investors attractive tax advantages, with no personal income tax, capital gains tax, or property tax. This tax-friendly environment not only attracts individuals seeking to live in Dubai but also makes property investment an appealing option for those looking to optimise their financial portfolios.

International investors, Jai Mahtani and Sudeep Ramnani have deliberately and strategically located themselves in Dubai, in order to be where they regard as a global investment destination and centre of commerce, with a convenient time zone, direct flight routes and a thriving property market.

This has encouraged them to invest heavily in Dubai’s booming real estate market, both as individual investors and in active ultra-luxury property development in partnership with Innovate Living, a renowned multi-faceted real estate firm.

In the words of the two investors, ‘Dubai’s dynamic landscape provides an unparalleled canvas for investment. The city’s strategic advantages and relentless growth make it an ideal playground for those with a passion for innovation and a commitment to shaping the future of real estate’.

Exploring Dubai’s rental market, it’s evident that it is dynamic and diverse, offering a range of property options from luxurious apartments to high-end villas. The city’s popularity as a destination for expatriates and tourists ensures a steady demand for rental properties, providing investors with opportunities for attractive rental yields. According to Property Finder, the average rental yield in Dubai was 6.4 per cent in 2022, making it a lucrative market for property investors.

In conclusion, investing in property in Dubai presents a compelling opportunity for investors seeking a stable and lucrative market. The city’s strategic location, stable economy, innovative infrastructure, and investor-friendly policies, coupled with the impressive statistics and figures, contribute to its attractiveness as a real estate investment destination. As Dubai continues to evolve and position itself on the global stage, investors who capitalise on the city’s potential stand to benefit from the lucrative returns offered by its thriving property market.

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