Recent years have seen a huge changes in Dubai. Widespread construction and development has seen the beginning of high levels of external and internal investment beginning to bear fruit throughout the emirate. So why should you consider investing in Dubai above other property markets? Below are outlined some of the key factors for analysis when you are considering investing in Dubai properties.
Shortage Of Property
The population and in particular the economy of Dubai is growing at an exceptional rate, and its average 8% growth in annual GDP makes Dubai one of the worlds fastest growing economies. As such, there is a large and sustained demand for property in Dubai. At present, this growth in the market in the market for property in Dubai shows no signs of slowing. An estimated $40 billion dollars has been invested by the Dubai government into the emirates real estate market.
Rising Building Costs
A fundamental influence on property prices are rising building costs such as raw materials, and the rapidly increasing costs causing by the shortage of raw materials is undoubtedly having a majro impact in Dubai at present. The low US dollar is pushing up the cost of materials from Europe, which is pushing energy prices to its peak.
Tax Free Income
The opportunity to earn tax free high salaries has resulted in an influx of foreign nationals seeking employment and subsequently property in Dubai. This has created a long term sustainable demand for property in Dubai.
International Business Centre
Long recognised as the leading regional trading hub of the Middle East, Dubai has now become an international business and re-export centre. It’s strategically important location beetween the major markets of the East and West will enaure its long term viability as a major global trading hub. New commercial property developments such as Business Bay, Internet City, Media City and DIFC are attracting large numbers of international companies who are looking to establish regional headquarters in Dubai.
Foreign Ownership Laws In Dubai.
Only in recent years have foreign nationals been permitted ownership of property in Dubai on a freehold basis. Following the changes in legislation, the Dubai government has actively encouraged foreign investment in property via attractive offers to overseas investors.
Tourism in Dubai
Dubai is one of the worlds fastest growing tourism markets, and it is expected to receive in excess of 15 million visitors. Today, Dubai has more luxury hotels than anywhere else in the world, and with fill rates currently standing at over 90%, the demand for luxury accommodation seems to be increasing still further.
Buy versus Rent
Any long term resident in Dubai is likely to spend a considerable percentage of their income in rent, and that money is better invested in a property. In addition, it is presently up to 40% cheaper to buy than to rent, so buying a big villa in Dubai costs approximately the same as renting a small one. The 10% down payment on a new villa is the same as the upfront annual rent payment.
Returns For Investors
Prices for properties in Dubai are appreciating steadily at a rate of around 10-14% per annum at present. It is estimated, based on current growth, your initial financial investment is expected to at least double.
Currency Exchange Rates
The local Dubai currency, the AED (Dirham) is currently fixed with the US Dollar. The recent strength of other currencies such as Sterling and the Euro against the Dollar have resulted in investors acheiving a 10-15% increase in ready equity compared with the same prices two years ago.
If you would like to find out the very latest information on the Dubai property market, why not visit our blog, where we discuss the issues of the day which effect the Dubai real estate market.