Being world famous for its endless skyline of skyscrapers and a development boom that turned the city from a desert village to a thriving metropolis in just over two decades, making the connection between Dubai and real estate comes naturally to most. And with it, one of the biggest misconceptions around the city, associating luxury and glamor with unaffordable property prices, a privilege of the rich and those already living there.
Truth is, investing in a Dubai property has never been easier and more accessible than it is today.
Buying a property in Dubai makes a great investment opportunity as it is both cheap and with great potential for future growth. When you compare Dubai to other similar trading hubs around the world, property prices are still relatively inexpensive. Despite the recent uptick in the market, mostly because of the city's remarkable response to the global pandemic and in anticipation of Expo 2020, prices have never fully recovered to pre-2014 levels.
No extra taxes
Affordable real estate is backed by favorable taxing conditions which could further maximize one's profits. In the UAE, there is no property, income or inheritance tax nor any stamp duties associated with buying a property. The only fee applicable is a Dubai Land Department (DLD) transfer fee charged at 4% of the purchase price. Usually paid by the buyer, this is a one-off and also very small amount to be paid compared to the amount of taxes one can save on an annual basis.
Anyone can buy a property in Dubai, provided they have the money for it. There is no age hurdle or limit like there is no requirement to live or work in the city. Dubai real estate is freely available to people who do not live in the UAE with no restrictions attached other than foreigners can only invest in leasehold or freehold properties found in designated areas. Either close to the city center or more spread out across the Emirate, these types of properties are in great abundance and the prospective buyer only needs a valid passport to be eligible. Other than that, to have a clean police clearance certificate, proof that the property is mortgage-free or for at least 50% of an existing mortgage to have been paid off pretty much complete the list of requirements for investing in a Dubai property.
Another fact worth noting is the multiple entry points into the Dubai property market as, apart from the above, one can also buy property through setting up an Offshore company or a UAE Foundation.
Regulated and Transparent Industry
The Dubai government has long acknowledged that improving transparency attracts foreign investment and has over the years strived to make this a basic pillar of its attractiveness as an investment hub. Today, Dubai ranks as one of the most transparent real estate markets in the MENA region and investors are protected by a series of real estate laws and regulations and government bodies that are on par with international destinations. While stringent, real estate regulations are at the same time flexible and investor-friendly and allow investors to buy literally everywhere with minimal conditions attached and give the opportunity to non-residents to choose among a huge variety of freehold areas to invest in.
Depending on the amount of investment, type of property and other conditions, investing in a Dubai property opens the door for obtaining a long-term residency visa, fast and with no hassle, for those who wish to become residents and without having to setup a business in the country.
Being a UAE resident, either choosing to actually live in the country or not, offers many benefits some of which we list below:
- Eligibility for many benefits such as Emirates ID and UAE Driving License
- Ability to sponsor the entire family and dependents
- No personal income tax and no corporate tax
- High quality of life
- Visa-free travel to certain countries due to a vast network
- Access to bank accounts and other financial services
- Easy renewal of property visa for as long as the investor owns property in the country
Qualifying for all of the above benefits, there is ample choice of property visas one can choose from:
3-Year Dubai Property Visa
The visa is issued for 3 years and can be renewed at a minimal cost. The minimum investment requirement recently went down from AED 1m (approx. US$ 272k) to AED 750k (US$ 205k) making a property investment in the city even more appealing. This visa offer is available only when purchasing a residential property ready for occupancy or if all construction for an off-plan property is fully completed.
5-Year Dubai Property Visa
If you have invested at least AED 2m in properties (can be split across three properties), have no mortgage on any and are willing to retain your investment for at least 3 years then, you qualify for a 5-year Dubai property visa. Your family members can be sponsored for residency visa and following some recent developments, male children can be sponsored with no age limit whereas previously it was set at 18 years old.
10-Year Residency Visa (Golden Visa)
This visa is available to individuals who invest at least AED 10m in the UAE. A maximum of AED 4m can be in real estate (split at a maximum across three properties), there is no mortgage on any of them and the investors are willing to retain their investment for at least 3 years. The other AED 6m must be made in local public investments or just keep in local funds i.e. cash in a bank.
UAE Retirement Visa
This visa is valid for 5 years and is offered to retired residents over the age of 55 or after completing work in the Emirate. So long they meet at least one of the following eligibility criteria:
- Invest in a property worth AED 2m
- Have financial savings of no less than AED 1m
Have an active income of no less than AED 20k per month.
Investing in Dubai property has more benefits than meets the eye and serves multiple purposes.
First, Dubai is a global destination. It is a city that is continuously advancing and offering massive opportunities to entrepreneurs and investors, an exceptionally well infrastructure and an unmatched standard of living. Investing in a city where it also makes sense relocating to is a determining factor for many and Dubai fulfills the criteria.
For those not wishing to live in the country but yet have the money to invest in it, once again, Dubai makes its case; investing in Dubai property is not only fast and straightforward but also makes financial sense as prices are affordable both on a relative and an absolute basis. Expo 2020 is a live proof of all the potential the city holds for the future, as the positive influence of the event on real estate is yet to be felt in the market.
The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.