Undoubtedly, the UAE continues to grow into a highly appealing hub for investors all over the world. Places like Dubai have a greatly successful real estate market, especially when it comes to residential property. With the current high demand for houses and apartments all over the nation, making a property investment here certainly promises to deliver major profits.
In this article, we will take a look at some of the reasons why an investment in residential real estate might be your best choice in this market. There are many vital factors to consider, as well as areas and types of homes that might lead to better gains.
- What are the most relevant factors that support the growing demand for residential property in the UAE?
- Why take into consideration the option of buying residential real estate in Dubai?
- Which are the best districts for residential real estate investment in Dubai?
- Why is the UAE a secure haven for residential property investment?
- How do you buy a residential property in Dubai?
- What are some of the types of property investment strategies for the UAE you can opt for?
- How can Connect Property help you to carry out a safe residential property investment in Dubai?
1. What are the most relevant factors that support the growing demand for residential property in the UAE?
The UAE’s prosperous economy, supported by highly convenient tax conditions and tax-exempt zones, makes the country an ideal place of residence for highly paid workers. The oil industry has attracted a sudden flow of foreign workers and expatriates looking for accommodation to buy or rent. As this population group increases, a constant demand exists for cost-effective and community-centric homes. In this way, these top-quality properties are driving a rise in the UAE residential property sector.
Experts have stated that this surge in demand is due to changes in customer needs regarding purchasing real estate. Spurred by trends such as distance working and community living, townhouses and villas are becoming the preferred choice for residential property buyers. Expatriate families are currently searching for more wide spaces, in the form of separated or semi-separate houses. Affordability is still a significant factor. However, now in the UAE, there is a greater demand for community-centered homes.
Moreover, villas and townhouses are seeing a higher capital appreciation than apartments in the UAE. A recent report from the leading consulting group ValuStrat, reveals that the residential value price index for Dubai has increased 12.6% year on year. Numerous villas and townhouse locations have seen their capital values stabilize or improve compared to previous months.
Another factor supporting the demand for buying residential property is the issued directives towards facilitating the process of obtaining and retaining residential visas. These initiatives are helping to form a more solid image of the UAE as a splendid permanent home. In addition, the Expo 2020 impact contributes to and sparks the real estate investment boost. The country continues to offer attractive opportunities for foreign investors. Short-term visitors are likely to turn into long-term residents as well.
2. Why take into consideration the option of buying residential real estate in Dubai?
Dubai is amongst the most happening locations all over the world. There are other cities in the UAE well known in different parts of the world due to the variety of facilities they can offer. However, Dubai is the ultimate site for anyone looking to invest in real estate. In such a manner, there are various reasons why you should buy a residential property in Dubai, such as:
2.1. Excellent returns on investment
The Dubai real estate market is getting better continuously as the population increases. Many investors are informed about this and how it is beneficial for buying property. In this way, they analyze a possible rise in demand for rent and new prices for properties.
2.2. No yearly property taxes
One of the biggest pros of property investment in Dubai is that you do not have to pay any charges for the same. It includes residential and commercial units, and once you have made the sales transaction, there are no extra taxes.
2.3. Variety of options
When it comes to investing in Dubai’s real estate market, there is a wide range of options available for investors to choose from. The main categories are residential properties and commercial properties. For instance, you can opt to buy a villa or apartment or industrial properties and offices, depending on your purpose.
2.4. Importance of the Expo 2020
Another reason why it is worth buying property in this city is because of the Expo 2020. Since its announcement, it has helped the off-plan real estate sector do well. Besides, investors who purchased properties close to the mega event are experimenting remarkable returns on their investment. Also, this implies that many people from different countries who visited the Expo 2020 felt attracted similarly to renting property.
3. Which are the best districts for residential real estate investment in Dubai?
A major advantage of buying residential property in various areas of Dubai is that the city’s economic growth has an excellent pace, as well as constant population growth. Since the implementation of freehold areas, Dubai is a powerhouse of foreign investment.
Most of the areas in Dubai have both commercial and residential properties. Compared to other major cities, purchasing real estate in Dubai is overall cheaper, and brings on average a higher rental income. Thanks to Dubai’s tax system, quick pace in quality construction, and high demand for business investments, the real estate market is really flourishing all over the city.
3.1. Best residential districts in Dubai
For investors looking to buy residential property, keeping in mind the district the home is in is important to guarantee a good profit. An area with a high rental yield is great to easily return your investment.
One of the areas with the highest ROI is Jumeirah Village Circle. An apartment here can have an average of 7.4% rental yield. Other areas with high ROI include Dubai Marina, Downtown Dubai, and Arabian Ranches. All of these districts have residential properties with an average ROI higher than 5%.
4. Why is the UAE a secure haven for residential property investment?
The UAE has a rising population and thousands of overseas workers moving to it every year. They want to expand their professional careers in a trustworthy, cosmopolitan, and global business hub like Dubai. For this reason, it is not strange that the UAE is recognized as a safe destination for residential property investment.
Today, this country offers numerous investment opportunities in the housing sector, whether for a long-term investment or ready-to-move-in units. Besides, following the issuance of the much-anticipated foreign property ownership in 2002 that allowed non-locals to buy property for the first time in Dubai. The region has witnessed a massive construction boom, captivating many foreign investors into the UAE’s property market.
Being a highly regulated industry, there is a set of real estate laws and regulations with the purpose of protecting property investors’ interests. The Dubai Land Department handles all matters related to purchases and registration of land sales. Additionally, the DLD publishes updated information concerning real estate purchase and sale transactions, to keep well-informed the investors.
Moreover, there has been some doubt among property investors about which UAE developers they should buy property from. However, thanks to the new property law no. 8, the transparency in the real estate industry has increased. It regulates the property developers’ professional conduct and makes sure that false promises and late delivery stay in the past.
The law means that any person who purchases UAE off-plan property will make the required payments to the Land Department certified banks instead of doing it directly to the developer. Then, developers will not have permission to access the funds until certain stages of construction are completed.
5. How do you buy a residential property in Dubai?
A common way to start the process of buying a property in Dubai is by looking at online agencies. With hundreds of residential listings, these websites can provide a good look at your options and help you determine your next step.
Once you have decided on a property to buy, the first step is to establish an agreement between the buyer and seller. Once the contract is prepared by a real estate agent, both parties sign it in front of a witness at the Registration Trustee office. A refundable 10% security deposit is also required on the residential property.
After this, the seller, buyer, and real estate agent meet at the property developer’s office to apply for a No Objection Certificate. Once this is finalized, the parties meet at the Dubai Land Department to officially conclude the property transfer.
Depending on your case, there might be certain extra steps and documents you might need. However, these are generally the steps you will follow to buy a property in Dubai.
6. What are some of the types of property investment strategies for the UAE you can opt for?
A strong infrastructure, lower prices, and a mind-blowing demand for residential properties and their commercial counterparts are driving the success of the UAE real estate market. Investors continue to see a rapid profit increase from their investments with strategies ranging from short to medium or long term.
6.1. Short-term investment strategy
Investment strategies on a short-term basis offer the lowest level of difficulty as the purchase has not yet been legally made. Thereby, no management charges or property taxes are due. This scheme is a simple capital investment. In many cases, there is no need to make any mortgage finance arrangements or proceed to a purchase contract. What is required is that they invest with confidence, knowing they can cover payments to completion of the unit. If it is necessary, they will have to adapt their strategy. Here are some reasons to invest with confidence.
In addition, to curb risks, short-term investors should seek to buy a high-quality residential property such as a ground floor unit with an exclusive garden or a penthouse. It will always sell rather than a regular first-floor unit.
6.2. Medium to long-term investment strategy
Mid to long-term property investors normally look to hold onto their units after construction, either to benefit from capital gains upon eventual resale or to rent it out. Many of these investors use the most popular up-and-coming locations in the UAE to generate significant rental income over a time period. In case they buy an off-plan property in Dubai, there is a requirement for full payment for the property at various stages of construction.
Besides, for mid to long-term investors, a tax-free purchase transaction brings with its low costs. However, they will have to factor in the costs of raising a loan and maintenance, utility, and community bills.
7. How can Connect Property help you to carry out a safe residential property investment in Dubai?
With Connect Property, you can look through our detailed listings to find an ideal residential property in Dubai. Through our marketplace, you can contact property owners that are trying to find a potential buyer.
Filter your search by characteristics, price, and location, in order to find a home that best fits your investment goals.
Thanks to our website’s intuitive interface, the process of buying a property is much simpler. Any user can easily navigate our pages, which makes real estate investments more accessible for all individuals. For additional help, we also have a 24/7 support hotline available, as well as other various ways to contact us.
Are you interested in more information about opportunities to acquire residential assets throughout the UAE? Be sure to call our phone number, +971 43 316 688, to reach out to our specialized advisors. You can also write us an email at firstname.lastname@example.org and a representative will give you any additional information you may need. We will gladly assist you whenever you need help, make sure to get in touch with us!
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