Would you ever invest in Dubai?

Question

Dubai Real Estate Market can now be defined by two things: dropping prices and an over supply of real estate.

However, even in its 6th year of declining prices, sale transactions have been increasing.

Could it be fear buying, a post pandemic result? Or has real estate become for everyone?

The city has a range of products from affordable housing to designer properties by designers Elie Saab and Bvlgari and each and every unit with a premium finish. Investors can purchase freehold property which entitles the buyer to land ownership as well. Many investments now offer buyers attractive visa and business licenses which can be used to buyers benefit.

But is this enough to invest in Dubai? I'd love to know your thoughts.

Sobia N Ahmed · Answer

Investing in Dubai certainly offers many benefits such as higher ROI , no property tax, no repatriation fee, long terms visa etc.

Ranked as the 7th safest city in the world. A home to 200 nationalities , state of art infrastructure, world class healthcare facilities and educational system, world's favorite tourist destination and a continuously growing business hub.

Even during the pandemic the property market has shown stability and offers promising ROI.

Conducting due diligence before making an investment can really help.

Dubai land Department's website provides detailed legal information.

dubai rest app is also very helpful.

Rebecca Moreira · Answer

Investing in real estate should follow some basic principles. A growing population, a diverse economy, low unemployment rates, a robust and respected legal system, and ultimately reliable data with which you can base your investment decisions. While Dubai may have some of these key points (pre-COVID) I would question the reliability of the data produced and argue that there are more preferable places with a long-standing and respected legal system that does not favor certain individuals. Doing so, I consider to be highly speculative and a blueprint which I do not follow. For these reasons, I would avoid investing in a places such as those mentioned or any other country with similar legal, political, and economic factors.

Ujwal Velagapudi · Answer

@Afreen Khan I'd also fear those items you've mentioned based on speaking with a few local business people from my last couple of visits there. It just doesn't seem like the economics make all that much sense with an oversupply, and it being amplified during a time like this. Curious as well to see what other investors in that market would say. But to answer your question, I would consider it down the line, maybe if they artificially restrict new permits to contain the supply in the long term. I'd also need other business interests there simultaneously, otherwise a one off investment just wouldn't make sense to me.

Greg Scott · Answer

As a foreigner, I would be very hesitant to invest in Dubai.  While diversification could be a positive, there are many additional risks.  Aside from the normal currency and economic risks, there are significant political risks in the region.  Moreover, price movement in the market appears to be highly speculative with significant valuation swings based on hot money flows.

I'd want a lot of clarity regarding ownership rights such as whether or not the government is going to require an Emirati partner or I have the ability to control my own destiny.  What are the restrictions, if any, on getting my money out of the country at the end of the project?  I'd also like to see tensions with Iran subside and oil prices strengthen.

For now, I have better opportunities with lower risk at home.

Adham Alkhaja · Answer

Hello Afreen. Nice to connect with you, this is a really good question. I am looking forward to the answers as I am also looking to invest in real estate in Dubai.