Analyzing Common Investment Mistakes in Dubai Real Estate: Detailed Overview

Having analyzed the common mistakes in investing in real estate in Dubai, we would like to share our thoughts on why it is not advisable to sell real estate in Dubai soon (including 2025). To better understand this situation, we will look at the current situation in the real estate market in this Arab metropolis.

Stability of the Real Estate Market in Dubai

Currently, the United Arab Emirates in general, and Dubai in particular, demonstrate one of the most stable and diverse economies in the world. This economy is firmly based on several industries, including tourism, finance, construction, retail, and infrastructure. This foundation guarantees a favorable investment climate even in the long term.

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In addition, recently the state has been actively introducing attractive legal and regulatory conditions aimed at protecting property rights and simplifying real estate transaction procedures.

The growth in demand for housing and the increase in population are influenced by both natural factors and the influx of relocators, tourists, and foreign workers:

• From 2012 to 2022, the number of wealthy people living in Dubai increased by 62%.
• The metropolitan area’s real estate market set a sales record of $81.69 billion.
• Average prices for rental and sale of housing have increased significantly – by 19% and 12%, respectively, in 2022.
• Dubai’s Jumeirah Village Circle and Dubai Marina led the way in rental yields, with average rental yields of 6.9% and 7.04% respectively, outperforming other cities such as Ottawa (4.6%). and New York (5.8%).
• All these factors indicate that the real estate market in Dubai will continue to grow and improve soon.

Properties in the JVC Area

Jumeirah Village Circle has been noted as one of the most profitable areas for investors. Let’s look at its features and the reasons for the constant increase in the cost of rental housing in this location.

JVC is a vibrant and modern community with 24-hour security to ensure complete safety and comfort for residents. The community is also conveniently connected to major arterial roads and has extensive social infrastructure, including schools (which are only present in some areas of Dubai). JVC has a variety of attractive residential properties with high investment potential.

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Recent Developments in JVC

Over the past year, 5,647 properties worth $1.5 billion were sold in the Jumeirah Village Circle. The average price per square foot increased by 7.25% to $2,600. This is also reflected in the cost of rent, which is constantly increasing.

Alternative Uses of Real Estate in Dubai

When buying property in Dubai, the owner has several alternative options for use, all of which promise to be profitable and promising.

• If you do not plan to move to the UAE, an apartment or apartment can be rented out for a quick return on investment. Another option is to change its purpose to commercial premises.
• You can also immediately purchase commercial real estate. Such properties that promise high returns can be an excellent asset. For ease of management and maintenance, they can be transferred to a specialized company to avoid the need for personal involvement in these matters.
• Investing in hotel real estate in Freehold zones is a very profitable option. Such real estate can be used for further resale, inheritance, or management by a hotel operator.

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Important Considerations for Resale

It is important to remember that real estate resale is possible only if the property is paid for by 30% or more. This rule was introduced to prevent speculation in the market. In addition, when transferring ownership, you must pay a fee, the amount of which in Dubai is 4% of the value of the property.