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Off-Plan Investment In Dubai: Why It’s The Hottest Opportunity Anywhere In The World Now?

Off-Plan Investment In Dubai:  Why It’s The Hottest Opportunity Anywhere In The World Now?

Many factors combine to shape the climate of off-plan investment in Dubai. Currently, Dubai is the fastest growing Emirate in the UAE with the most mature economy. This growth rate is being sustained without the benefit of revenue from oil exports. This diversified economic base gives off-plan investment in Dubai a certain resilience.  Thanks to its buoyant income-generating business sectors such as tourism and leisure, retail, hospitality, logistics support, and real estate amongst others.


Why Opportunities For Off-Plan Investment In Dubai Are Hot

When you are investing your money in real estate and especially in an overseas property, you are not only investing in that particular development, you are investing in that country’s economy as well.


Here are 9 forces propelling off-plan investments in Dubai:

  1. Consistent Economic Growth

One of the most important things to consider when buying property anywhere in the world is the region’s economic growth. And one of the biggest benefits of buying a property in Dubai is its economy. This innovative city has been growing at a steady pace.


Being the home base for Emirates Airlines and Fly Dubai, Dubai attracts significant numbers of visitors each year. In 2017, Dubai welcomed around 14.9 million overnight tourists. Dubai has flourished despite the global downturn in the price of oil.  Furthermore, it has emerged as a champion of strategic planning and economic growth in MENA region.


  1. Consistent Population Growth

Owning an investment property in a ghost town where people are leaving is a nightmare for investors. This is especially true if you are looking for a predictable property yield. Dubai is a cosmopolitan city where residents are drawn from more than 110 different countries. Each year the Dubai’s population steadily increases as people from all over the world come to Dubai for career and business opportunities.  This continuous increase in population is leading to a steady demand for housing in the Emirate.


  1. Security

Among the many benefits of an off-plan investment in Dubai, is its reputation for safety and security. This is one of the major reasons why people find living and working in Dubai a breeze. While many countries in the Middle East region have experienced political and economic turbulence, Dubai remains a haven of political calm and stability.


  1. Affordable Acquisition Costs

Acquisition costs in Dubai are currently lower than in many other comparable major cities around the world. The average price per square foot in Dubai is around USD 468.  This is significantly lower when compared to USD 3,208 in London to acquire same property.


  1. Range Of Off-Plan Investment Alternatives

One of the primary benefits for off-plan property investors in Dubai is the wide range of choice of property investments. Dubai’s ebullient off-plan real estate market is home to a variety of options to choose from. Regardless whether you are looking to invest in an in an apartment,  a villa, or a commercial property, new developments are steadily being released to the market.


  1. Attractive Rental Returns

Dubai’s rental returns are competitive compared to comparable major real estate capitals around the world. The best performing areas of Dubai are generating up to 6 to 8 percent rental yield on average. The average rental yield in New York is a miserly 3.91% while in London it is a depressing 3.21%. Singapore is even lower at 2.83% and in Hong Kong, it’s a struggle to realise more than 2.82% rental income.


On a very conservative basis, the rental return in Dubai rarely dips below 5.82 percent.  This makes Dubai one of the best destinations around the world for property investors. Some communities in Dubai offer rental yields as high as 9 to 10 percent per annum.


So if you want to enjoy the benefits of an off-plan investment in Dubai, factor in the higher rental income your investment could potentially generate in Dubai.


  1. Attractive Capital Appreciation

The performance of any given off-plan investment is all about location, location, location, and timing. There are many projects across Dubai today, delivering attractive capital growth. When comparing Dubai off-plan property to other major international centres, their returns look superior while their entry prices are cheaper.


  1. Innovative Infrastructure Development

Given the option of buying an off-plan property in a city where development and urban renewal has ground to a halt or in a city where new innovative, infrastructure concepts are continually launched which would most investors opt for?


Right, Dubai is well on its way to becoming one of the smartest cities in the world. Whether it is extensions to the Metro transport system or the mooted Hyper-Loop link to Abu Dhabi.  Dubai offers a continuing parade of new initiatives in infrastructure.


This helps keep the buzz around buying property in Dubai fresh and alive. Dubai is already home to the Burj Khalifa, the world’s tallest building.  The innovative flow of concepts promoted by Dubai government is a healthy sign that buying property in Dubai is a sound decision.


  1. No Property Or Capital Gains Taxes

There is no property tax in Dubai. There is a general VAT which applies to the purchase price. However, once you have bought the property, and paid the registration fee to the Dubai Land Department, there are no other government taxes to be paid on your property.


Moreover, there’s no capital gains tax in Dubai should you choose to sell and make a capital gain on your investment. This tax aspect alone has a significant impact on the overall financial attractiveness of an off-plan investment in Dubai.


To add to the attractive tax position in Dubai, there is no income tax payable on property rentals. That makes the choice even easier to buy an off-plan property in Dubai.


  1. UAE Property Visa

One of the underappreciated benefits of buying property in Dubai is the opportunity to become eligible for a residency visa.  You can obtain a residency visa depending on your Dubai off-plan property purchase. The visa requirements for this include the following;  property value of at least AED 1 million;  no mortgage on the property; it is completely habitable. Dubai Land Department has the full details of an investor visa for your property purchase in Dubai.


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Final Word

Many factors have combined to make an off-plan investment in Dubai attractive for investors. Dubai’s steady economic and population growth, its safe and secure environment, and its positive investment climate, to name a few.  Certainly, opportunities for off-plan investment in Dubai are amongst the hottest anywhere in the worlds. Don’t miss out on investing in a vibrant, dynamic city of the future!


Ahmed Al Neama

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