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Buying property in Bluewater Island or another up-and-coming community in Dubai is a great investment. That is why local residential units are in demand among both Emirati and foreign buyers. What exactly makes Dubai properties one of the most investment-attractive assets in the international market? Let’s figure it out below.
Reasons to invest in Dubai real estate
Among the key reasons why foreigners decide to buy property in Dubai, the following factors should be highlighted:
- Stable economy. The emirate has an open economy with a high per capita income and a significant annual trade surplus. The government is constantly increasing budget on job creation, developing infrastructure and opening up new opportunities for more active participation of the private sector.
- Favorable tax system. The UAE differs from many countries in the world because people do not have to pay any taxes for owning local real estate. Citizens of foreign states that are not members of the Cooperation Council for the Arab States of the Gulf have the right to purchase an apartment or villa in Dubai in full ownership. There is also no tax on business or personal income. Special tax is imposed on those companies whose activities are related to the oil and gas industries, and the banking sector.
- High standard of living and safety. Dubai is considered one of the safest cities in the world, which is very important when buying property. Even petty crimes happen here infrequently. In addition, the UAE is a beacon of stability in the Middle East from an economic and political point of view. In the global rankings, the city ranked 74th in the quality of life rankings and topped the MEA region for the fifth year in a row. This year, Dubai moved up one position, overtaking its geographical neighbor Abu Dhabi. The annual survey covers 231 cities and helps companies and organizations determine the amount of cash compensation for international employees. Many criteria are used to compile the rankings, such as political stability, health care, education, crime rates, recreation, and transportation.
- High return on investment. The city is in great demand, and therefore the minimum income from buying an apartment and renting it out will be 5%, in more respectable areas, profit can bring 8% of income. Moreover, owners can sell real estate at any time, and there will always be enough people who want to purchase. According to a recently published joint report by Reidin and Global Capital Partners, in the decade that has passed since the global economic crisis, the city’s real estate has brought its owners 120% of the profits. According to analysts, the real estate market of the emirate was second only to the Nasdaq index.
- Low real estate acquisition costs. In addition to saving money on taxes when investing in Dubai real estate, the investor benefits from low acquisition costs. Compared to the money he could spend in cities like New York or London, the cost in Dubai is only a fraction. When buying a property in Dubai, an investor will save from 30% to 70% compared to the cost of purchasing a similar property in other major cities around the world.
Prices for property in Dubai in 2022
According to the DLD, in 2022, real estate transactions in the emirate reached record levels not only in comparison with 2020, but also with earlier periods. In the second quarter of 2022, there were 22,482 real estate transactions, which is a 45.2% increase in the volume of transactions in the same period in 2021 and almost twice as many as in the second quarter of 2020. At the same time, more than half of the transactions were for off-plan real estate.
Currently, the median price of apartments exceeds AED 1 million (about USD 280,000), while the average price per square meter has reached AED 10,775 (USD 2,933). Median prices for studios are in the range of AED 390,000-760,000 (USD 106,000-207,000), for one-bedroom apartments – from AED 700,000 to 1.2 million (USD 190,000-348,000), for two-room apartments – AED 1-2 million (USD 280,000-550,000).
The average price for townhouses is AED 1.7 million (USD 462,000), while the average price for villas is approaching AED 4 million (over USD 1 million). In general, the price of villas and townhouses varies from AED 5.5 million to 17.5 million (USD 1.5-4.5 million). The most expensive properties are located on the Jumeirah Islands, and the cheapest villas can be bought in the still under construction MBR City.
Assistance with buying property in Dubai
A wide range of Dubai real estate in various configurations and price categories is presented in the catalog of AX Capital. Contact the highly qualified specialists of the agency to get help with the selection of the optimal residential property, support at all stages of the transaction and high-quality after-sales service. In addition, the company’s clients can count on additional services, which include assistance with property insurance, activation of utilities and property management.