Dubai has become one of the fastest-growing economies of the world in less than 40 years. Established as the most appealing city for investment, Dubai has a highly diversified economy. This Middle Eastern city has transformed itself into a vibrant, tolerant, and inclusive multicultural society over the years to become the biggest business hub in all of the Middle East.
The emirate of Dubai is famous for its towering skyscrapers, best malls in the world, and scenic waterfront tourism hub for foreigners. Other than the attractions it provides, Dubai is also an investor hub for people who are looking to purchase property in Dubai. For investors, it can either boost your current investment portfolio or prove as a secured home in one of the best destinations in the world.
Ten benefits of Real Estate Investment in Dubai
There are various factors that contribute towards choosing the best location to purchase properties in Dubai. These influencing factors are the size of your family, your other priorities, your financial goals as an investor, and budgetary concerns. But the good news is, the properties in Dubai are affordable, futuristic, and uniquely designed into residential communities.
There is something for every property investor or home seeker in Dubai, be it the luxurious villas and palatial townhouses for sale or a simple and affordable one-bedroom apartment for a small family. If you are looking to buying property or invest in Dubai’s Real Estate, the following are the benefits that will help clear your mind.
Constant Growing Economy
The economy of the UAE is constantly growing, and it is attracting more investors worldwide. The effort by the government is relentless to establish Dubai as an international business ground. The tireless effort by the government has been fruitful by providing numerous benefits like Tax Exemption and Free Zones. The projected economic growth in Dubai is aimed at substantially improving the transport, tourism, logistics, retail, and wholesale sectors.
Expanding Population Growth
The current populace of Dubai has arrived at 3.2 million, which is a huge development for such a youthful city. People from more than 200 affluent countries from all across the world are residing in Dubai; hence the population is ever increasing.
Since people are constantly moving to Dubai in order to find better jobs and business opportunities, it is one of the best reasons to invest in buying a property in Dubai. Dubai’s population is increasing at the rate of 10.7% every year, according to the World Population Review.
With phenomenal population growth, the city has witnessed an 86% increase in population from 2008 to 2018. Many new housing projects have already started to accommodate this growing population. This will bring more investment opportunities for investors who want to get a higher return on their investments.
High Return of Investment (ROI)
Investing in Dubai’s real estate will generate a high return of investment due to a lack of taxes such as property acquisition and capital gains. Furthermore, a 5% minimum investment yield is offered in Dubai, which is higher than what many of the major cities in the world offer. Renting out your property is also a smart way to earn a good amount of money in Dubai.
The ROI of over 6% is offered by most key neighborhoods in Dubai when it comes to the sale of apartments. The Villa communities offer an ROI of over 4%. However, International City, a popular area for purchasing properties in Dubai, offers rental yields of over 9%.
No Annual Property Taxes
If you buy a property in Dubai, there’s no need to spend money on annual property taxes, unlike the other major cities such as New York, London, and Hong Kong. Once the property is bought, and the registration fees are paid, there’s no additional or ongoing tax that needs to be paid. This is one of the best reasons to buy property in Dubai.
By investing in a property worth AED 1 million in Dubai, you will become eligible for an investor visa. The property you purchase, however, should not be under a mortgage or off-plan. After submitting a copy of your passport and the deed to the Dubai Economic Department, you will be issued a trade license on the property after getting the final approval from the Dubai Land Department. A two-year Residency visa can be obtained after that from the Immigration Department. Investing in a property greater than AED 5 million will make you eligible for a five-year renewal visa.
While there are definite perks of property investment in Dubai, there is a major drawback that needs due consideration.
The initial cost that comes with the purchase can become a bit expensive. A mandatory DLD (Dubai Land Development) fee of 4% of the property value must be paid to the developer. Also, the fee for issuing the Title Deed and administration fee needs to be paid upfront.
In addition to this, a Mortgage Registration Fee of 0.25% needs to be paid to the DKD if the buyer goes for mortgages.
Drawbacks aside, the demand for investment in Dubai is constantly increasing. Buying property in Dubai is a feasible way for investors to enjoy many benefits like no additional annual property taxes, residence visa, high return of investment, affordable properties in the best locations.
So, if you are convinced about the benefits of buying a property in Dubai, you can go ahead and realize your dream of owning a property in Dubai and starting a new life.