Dubai has one of the world’s largest real estate markets. In comparison to other markets worldwide, Dubai’s real estate market thrives in meeting the needs of home purchasers by offering remarkable benefits, exceptional value, and a wide range of incredible amenities.
According to the most recent data, the total amount of transactions in Dubai’s residential market reached a 13-year high in May as high net-worth individuals, investors, and entrepreneurs plan business migration to the city.
Investing in real estate is a great way to accumulate and grow wealth and earn income. Here are some things to know before buying property in Dubai.
Is It Worth Buying Investment Property In Dubai?
Yes, it is worth investing in Dubai real estate for the following reasons –
- Rents in the city are higher compared to numerous other mature real estate markets. On average, investors expect gross rental yields of 5-9%.
- Property prices per square foot in Dubai are lower than in many other cities worldwide, making it an affordable place to acquire premium real estate.
- Under some conditions, new visa laws linked to property investment allow investors to get a residence visa. You may be eligible for a 2-year residency visa if your property is worth more than AED 1 million. You may be eligible for a 5-year resident visa if your property is worth more than AED 5 million. For homes worth more than AED 10 million, you may be eligible for a 10-year resident visa.
- Highly favorable tax conditions, mainly the absence of stamp fees and property taxes that are common in other global real estate markets, present the city as a highly appealing investment environment.
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Purchasing Off-Plan Real Estate
It’s no surprise that off-plan property is big business in Dubai. Some structures have spectacular architecture that adds to Dubai’s global image as a real estate market to be reckoned with.
Typically, deposits ranging from 10% to 25% are required to place a hold on an off-the-plan property and initiate the purchase process agreement. Once this is finished, the Dubai developer and buyer are committed to the transaction, which can be finalized rapidly. Off-plan properties perform well in virtual property sales, with buyers coming from all over the world.
Purchasing a Resale Property
Resale property is subject to different sales procedures. The first component is the MOU, or Memorandum of Understanding. This details all of the previously agreed-upon terms of the sale, and the transaction is completed by paying a small deposit, often 10%. Closing timeframes for resale properties vary depending on the paperwork and whether financing is available, but they should take no more than two months.
Purchasing Freehold Or Leasehold Property
Dubai is divided into freehold and leasehold neighborhoods, which determine who can buy there. Some districts in Dubai are considered freehold, which means that any foreigner can buy property there, while others are considered non-freehold and exclusively available to registered GCC citizens. In addition, leaseholds of up to 99 years are available in Dubai.
What Is The Best Way To Buy Property In Dubai?
When investing in real estate, the ultimate goal is a high return on investment (ROI). Securing a property with reasonable rates of return necessitates adequate due diligence from the start. The best way to buy property in Dubai is to consider the given variables that can affect ROI:
- Community facilities and amenities, such as distance to transportation, childcare, education, and so on.
- Market circumstances and buying timing
- Rates of interest
- Maintenance expenses (RERA Service Charge and Maintenance Index)
There are two methods for determining whether a property is worth your effort. The first is an evaluation by the agency and developer, or you can do it yourself and hire your own evaluation firm. They will evaluate all factors to ensure that the property’s worth is in line with market expectations.
Suggestions To Maximize ROI When Buying Property In Dubai
- Choose affordable smaller-sized apartments (studio and 1-bedroom) with established infrastructure, close to transportation and vital amenities such as school and healthcare.
- Smaller flats sell faster and for a higher price than larger properties, owing to the fact that a large portion of Dubai’s expat community can afford to buy these when the investor wishes to release equity.
- Annual maintenance fees payable to the Dubai Land Department based on the RERA Service Charge and Maintenance Index can significantly impact overall returns. This index varies by community and provides a specific rate per square foot. Before you buy an apartment in Dubai, research the appropriate charges for your desired neighborhood.
If you ask – Is buying property in Dubai a good investment? The answer to that is – Yes. In fact, never before has there been a better opportunity to invest in Dubai. Consistent fresh supply provides purchasers with a wealth of options and continues bringing prices down to more affordable. Look no further if you want to invest in affordable quality real estate with high rental yields. Remember the discussed things to get the best property to buy in Dubai.