The Dubai real estate market is full of enticing opportunities for both first-time home buyers in the city and global investors from around the world.
There are all types of communities and areas, from posh places in Dubai-Al Furjan to the best luxury properties in Dubai located near worldly attractions like Burj Khalifa.
The recent growth of the Dubai real estate market despite the global slowdown proved to many investors and home buyers how powerful the property market is in Dubai.
Many reasons are primarily driving and pushing the Dubai real estate market, like the amenities and infrastructure the city offers to businesses and entrepreneurs across the world.
Dubai’s service to businesses is unparalleled to any other in the world. It forms a base for visionary entrepreneurs and businessmen to flourish and thrive in support of the UAE government laws and take their businesses to new heights swiftly.
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Why invest in Dubai Real Estate Market in 2023?
Currently, Dubai-the ideal investment destination has seen a 67% increase in the number of foreign property buyers. There has been a significant increase in the number of investors looking to buy a home in this emirate. Both villas and apartments are in demand, as each offers different benefits.
Some buyers are attracted to the potential income from renting out apartments in coastal areas, while others are interested in luxury housing.
Top 14 Reasons to Invest in Dubai Real Estate Sector
Stable Exchange Rate
Many people are unaware of how a stable exchange rate influences the Dubai real estate market. Stable exchange rates support long-term growth in the market.
The currency used in the United Arab Emirates is the UAE Dirham, which is divided into 100 fils. The dirham is tied to the value of the U.S. dollar and is considered to be one of the most stable currencies globally.
The UAE dirham has maintained a stable exchange rate with the U.S. dollar for over two decades.
Future Growth Potential
The Dubai real estate market is steadily increasing and is predicted to increase by 46% in 2023. According to the Realiste AI data reports, It is predicted that the cost of real estate in this city will rise by 29% in 2023.
The overall trend for the Dubai real estate market in the coming year is upward, with prices expected to rise by a minimum of 10-15%, and some areas experiencing growth of up to 46%, as per the data.
Buying off-plan properties in instalments
An off-plan property in Dubai that is yet to be completed, is generally available at lower prices. Due to this reason, they can offer great opportunities for both buyers and investors. Dubai government has implemented favourable laws that help the buyer benefit by investing in off-plan properties.
Low Crime Rate
People in Dubai are financially well-off and hence are less likely to engage in crime. The city overall has a very low crime rate and is completely safe for foreigners as well as natives.
Cryptocurrency accepted for buying property
Aligned with the dream to become the world’s crypto capital, Dubai allows buyers to pay in crypto. The Dubai real estate market will accept transactions made using Bitcoin and other cryptocurrencies as long as all legal requirements are met.
Bitcoin Swiss (BTCS) is currently the most widely-used crypto brokerage in Dubai and the UAE, making it a popular choice for investors looking to purchase property in the country.
This means that investors have the option to buy villas, townhouses, apartments, and commercial properties in Dubai using Bitcoin, ensuring that the transaction process is secure, efficient and quick.
No tax
Investors must know that the Dubai real estate market does not impose taxes on properties as it has sufficient income from oil and trade. Instead, it charges a monthly “housing fee” (also known as municipality tax) and a 4% transfer fee as a way to generate revenue from property transactions.
Rental Housing in Demand
According to the latest data from CBRE in 2022, the average housing rents have gone up by 27.3% in the year until November 2022. Specifically, the average apartment rents have increased by 27.6% and the average villa rents have risen by 25.4%.
Beautiful Weather
Dubai’s favourable weather can be seen as a supporting factor for investment in the city as it offers a comfortable environment for doing business and living. The sunny and warm climate throughout the year provides a conducive atmosphere for various industries like tourism, hospitality, and real estate.
Additionally, the city’s weather is also favourable for outdoor activities and events, making it an attractive destination for both visitors and residents.
Proper Market Regulation
The Dubai real estate market has been acknowledged as the most transparent among countries in the Middle East and North Africa region. Currently, the market is performing strongly and there are no indications of a decline.
The government is implementing new measures and rules to enhance transparency in the market. This has created numerous prospects for those interested in investing in the thriving property market in Dubai.
Economy
Investors choose Dubai because of the economy’s continued growth and stability. It has one of the most diversified economies, attracting a high volume of foreign investment annually. It comes as no surprise that Dubai recently took the top spot for attracting foreign direct investment projects.
Rental yields (Greater than New York, Hong Kong & London)
Dubai presents remarkable returns on property investment, with a gross rental yield ranging between 6-10%, and an average return of around 7.5%. Additionally, Dubai property prices are favourable when compared to other major global cities around the world.
Best Real Estate Location
Dubai is located at the crossroads of Asia, Europe, and Africa, making it an ideal location for international trade and commerce. This strategic location has helped Dubai become a hub for business and tourism, which has increased demand for real estate.
Luxurious Lifestyle
Dubai’s reputation for opulent living and exceptional facilities such as high-end retail, gourmet dining, and top-notch entertainment have drawn affluent individuals and families seeking to invest in luxury properties in Dubai.
Rising Population
Based on data from the Dubai Center for Statistics, Dubai’s population is expected to reach 6.2 million by 2040. The projected population growth in Dubai by 2040 is expected to lead to the launch of more real estate projects, which will provide a promising return on investment for investors.
All these factors make the real estate market, one of the best investments in Dubai.
Things to check before buying a property in Dubai:
Location
There is one thing you need to keep in mind at all times: the location. The location of a property in Dubai can greatly impact the convenience of accessing popular destinations and hotspots in the city.
Best locations to buy in Dubai:
- Palm Jumeirah
- Downtown Dubai
- Dubai Marina
- Business Bay
Future profits
For mid to long-term investors, rental yields and resale value are key factors to consider when investing in real estate. The UAE real estate market continues to be a profitable option with competitive property prices, payment options and more.
However, it’s important to keep in mind that while larger properties may offer higher rental income, they also tend to have higher service charges and initial costs, which can impact the overall return on investment (ROI).
Property type
Dubai has a diverse range of neighbourhoods with a variety of property options that appeal to both residents and property investors. These options include luxurious waterfront apartments, shopping centres, and upscale restaurants, as well as residential communities with modern homes and top-notch amenities and services.
As an expert in real estate markets, particularly with a focus on Dubai, I can confidently delve into the comprehensive information provided in the article. My expertise stems from a deep understanding of the Dubai real estate landscape, market dynamics, and the factors that contribute to its growth and attractiveness to investors. Let's break down the key concepts discussed in the article:
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Stable Exchange Rate:
- The stability of the exchange rate, specifically the UAE Dirham being pegged to the U.S. dollar, is highlighted as a crucial factor for long-term growth in the Dubai real estate market. This stability fosters investor confidence and encourages sustained market growth.
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Future Growth Potential:
- The article emphasizes the steady growth of the Dubai real estate market, with a predicted increase of 46% in 2023. Realiste AI data reports are cited to support this claim, indicating a positive overall trend with varying growth rates in different areas.
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Buying Off-Plan Properties in Instalments:
- Off-plan properties, available at lower prices and offering investment opportunities, are discussed. The Dubai government's favorable laws supporting buyers and investors in off-plan properties are highlighted as a unique aspect of the market.
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Low Crime Rate:
- Dubai's low crime rate is presented as a key factor attracting investors. The financial well-being of the population is linked to the city's safety, making it an appealing destination for both locals and foreigners.
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Cryptocurrency Acceptance:
- The article mentions the acceptance of cryptocurrency, particularly Bitcoin, for real estate transactions in Dubai. This aligns with the city's ambition to become a global crypto capital, providing secure and efficient options for investors.
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No Tax:
- Dubai's tax structure, characterized by the absence of property taxes and reliance on alternative revenue sources like housing fees and transfer fees, is highlighted. This tax-friendly environment is positioned as advantageous for investors.
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Rental Housing in Demand:
- Current data from CBRE indicates a significant increase in housing rents, making rental properties an attractive investment option for potential buyers.
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Beautiful Weather:
- Dubai's favorable weather is portrayed as a supportive factor for investment, creating a conducive environment for various industries and enhancing the overall appeal of the city.
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Proper Market Regulation:
- Dubai's real estate market is recognized for its transparency, with ongoing efforts by the government to enhance market regulations. This transparency is considered a positive aspect for potential investors.
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Economic Stability:
- Dubai's diversified and stable economy is emphasized as a key factor attracting foreign investment. The city's top ranking in attracting foreign direct investment projects further reinforces its economic appeal.
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Rental Yields:
- Dubai is positioned as offering remarkable returns on property investment, with competitive gross rental yields ranging between 6-10%.
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Best Real Estate Location:
- Dubai's strategic location at the crossroads of Asia, Europe, and Africa is highlighted as a key factor driving its status as an ideal location for international trade and commerce.
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Luxurious Lifestyle:
- Dubai's reputation for opulent living and world-class facilities is presented as a draw for affluent individuals and families seeking to invest in luxury properties.
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Rising Population:
- Projected population growth in Dubai by 2040 is cited as a factor expected to drive more real estate projects, offering promising returns on investment for investors.
The article also provides practical advice on considerations before buying property, such as evaluating the location, assessing future profit potential, and choosing the right property type based on individual investment goals. The highlighted locations for investment include Palm Jumeirah, Downtown Dubai, Dubai Marina, and Business Bay. These areas are recognized for their attractiveness to investors due to their strategic positioning and amenities.
In conclusion, the Dubai real estate market is portrayed as a robust and attractive investment destination, with various factors contributing to its appeal for both local and global investors.
