Real estate investment is a reliable way to save and diversify savings, and the UAE remains one of the most popular destinations for such investments.
Dubai is traditionally the most attractive emirate for investors. In 2022, real estate sales increased by 80%, according to Bloomberg. Abu Dhabi follows this. According to the emirate’s Department of Municipalities and Transportation, 1,722 transactions were registered and 1,582 mortgages were issued in the first quarter of last year. Ras al-Khaim is the last one at the top, which is just beginning to gain popularity among investors.
In 2022, foreigners bought 70% more property in Dubai than in previous years. Bloomberg’s research supports this. The reasons for this are several: diversified ways of making payments, affordable flights, favorable terms of installments, and most importantly – the absence of income tax for non-residents.
On a surge in demand for real estate in Dubai, the deal cycle shrank to just a few days, although the process used to last from 3 to 6 months. A large selection of objects to buy – both the advantage of the emirate market and its problem, because a large offer can prevent the investor from making the most advantageous investment. In order to avoid losses, it is necessary to define a clear purpose of the acquisition.
If it is a priority to receive revenues in the short term, it is worth investing in an object at the start of sales, and after a few years to earn on the rise in price. In the case that the investor is interested in the exit to the passive profitability (within 7-8% per annum), it is best to turn to facilities that are in the last stages of construction.
Dubai’s properties are rising in value every year. Apartments are the emirate’s most popular property category (55%). According to Dubai Real Estate Market Overview, their value in January 2023 increased by 12.5% compared to January 2022. Then there are villas (25%) and land (18%). Despite the fact that commercial real estate accounts for only 2% of the statistics, the total value of commercial real estate transactions increased by 66% in the third quarter of 2022.
Abu Dhabi – the resort center and the safest city in the country. In the coming years, the tourist flow will increase: museums will be opened in the city (Sheikh Zayed Museum has opened, and the Guggenheim Museum in Abu Dhabi plans to open in 2025), and forums and sports events will be held. The Yas Island has a thriving entertainment industry with Ferrari World Abu Dhabi and Warner Bros. World. These factors make the emirate’s real estate market one of the most stable (1-2% increase in property prices per year).
In 2019, a law was passed allowing non-residents to acquire ownership of commercial and non-commercial objects. This fact makes the emirate a relatively new investment destination. Unlike Dubai, which has become a home for «digital nomads», Abu Dhabi is better suited for business owners and those who plan to enter the country’s market.
Ras al-Haym is the best option for long-term investors. The government of the Emirates plans to invest in the development of the tourism sector in Ras al-Khaimah 134 million dollars. By 2025, the emirate’s fund is planned to increase by 15 thousand. places, which indicates a growing tourist flow and demand. The absence of a minimum threshold for the amount of investment in real estate to obtain a residence permit – allows the emirate to gain popularity among investors.
In the first half of 2022, real estate transactions increased by 45%. This is indicated by data from the local municipality. Residential and commercial property in this region is 30-50% cheaper than in Dubai or Abu Dhabi, but prices are rising steadily: in 2020-2021, the studio cost in a new building was 60 thousand dollars, and today for the same facility will have to pay twice as much money.
Experts rate the UAE as one of the safest destinations for real estate investment. This is true for both the short and long term. In this country, most investors will be able to find an opportunity to invest money depending on plans and opportunities.