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Why Dubai ?
Property is cheap on an International level
Property is cheap in absolute and relative terms. For
example at this moment, an average villa will cost around $1,000 per square
metre in comparison to London Docklands where it would cost $5,000 per square
metre. There are very few modern cities in the world where high-standard
property is priced so low.
Foreign Ownership
Dubai is in the process of creating an international
property market from scratch, with foreign ownership of freehold only
introduced last year. Thus buyers are given an exceptionally good deal to
encourage them to be pioneers.
Shortage of supply
The Dubai Government is working hard to prevent a shortage
of supply and is giving land to developers as an incentive. What looks like
massive supply today in Dubai may be nothing compared with demand in a few
years time. Dubai is after all growing its GDP by 7-8% a year and shows no sign
of slowing down, quite the contrary.
Rising Building Costs
A fundamental influence on property prices are rising
building costs. The low US dollar is pushing up the cost of materials from
Europe which is pushing energy prices to its peak.
Tax Free Income
Dubai is a city where a lot of people earn high tax-free salaries
and are in a position to support higher house prices. This is a city with a
20-year track record of strong economic growth and will continue to attract
foreign and regional inward investment.
International Business Centre
Long recognised as the leading regional trading hub of the
Middle East, Dubai has now become an international business and re-export
centre.
The country has developed rapidly over the past 10 years and
has transformed itself from an oil dependent regional entrepot into a highly diversified
international business centre of global significance, which offers
opportunities for UK business people in all sectors. At present, over 500 UK
companies have been set up in Dubai.
Tourism
Over 6.0 million tourists visited Dubai in 2010 and this
figure is expected to grow to in excess of 8.0 million by 2012. Dubai is going
from strength to strength.
Buy v Rent
Any long-term resident will pay out a fortune in rent, and
that money is better invested in a property. In addition, it is presently up to
40% cheaper to buy than to rent, so buying a big villa costs the same as
renting a small one. The 10% down payment on a new villa is the same as the
upfront annual rent payment. Rental yields of up to 10% are achievable in Dubai
compared to under 5% in Central London.
Returns for Investors
Prices for properties in Dubai are appreciating steadily at
the rate of 10% - 15% per annum, (for some developments even greater). It is
estimated that by 2009, based on current growth, your initial financial
investment is expected to at least double.
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