The degree of confidence of foreign investors in the real estate market in Dubai and the UAE as a whole is very high – according to a survey conducted among real estate investors on the eve of the largest industry event Cityscape Global, more than half of respondents who have an amount of $ 10 million are ready to spend this investment capital for purchase real estate in UAE. At the same time, 60% of respondents call the Arab Emirates the most promising country for profitable investments.
On the demand for real estate in Dubai at the regional and international levels says the statistics of the Land Department of the emirate. So, for the first half of 2018, investors invested $ 30.2 billion in the Dubai market.
At the same time, the most active investors included citizens of Great Britain and India. It is noted that among the most sought after parts of the emirate for the purchase of real estate are such world-famous areas, characterized by a high standard of living and first-class architecture, like Dubai Marina, Palm Jumeirah and Downtown Dubai. It is here that foreign investors can purchase real estate on a freehold basis, which gives full ownership of the property, and be sure of its high liquidity.
Such a high degree of investor confidence in the real estate market of the emirate is due, first of all, to the dynamic economic growth of the industry: at the end of 2017, there was an unprecedented demand for objects under construction. This year, the ratio of demand between the constructed and finished objects has stabilized, but developers are still starting new projects, especially in the hotel real estate sector.
According to the data published in the report of the consulting agency Asteco, in the first quarter of 2018 the Dubai real estate market was replenished with 3,650 new real estate properties. Among them are 625 villas, the rest are apartments. Most new projects are located in investment zones, where there is the greatest demand for the purchase and rental of real estate.
In the first quarter of this year, only 12% of the number of new objects projected for 2018 have entered the market. Until 2019, the Dubai property market should take another 30,000 housing units. Most of the new facilities will be apartments (about 21,000 units), and about 5,000 villas will be completed.
The most popular districts among the tenants promise to become Jumeirah Beach Residence and Jumeirah Village, where a 15% decrease in rental rates is fixed compared to the level of last year.
In addition, government support plays a significant role, manifested in the form of regular review and supplementation of legislation regulating real estate purchase and sale transactions. Government invests much in infrastructure development and support of sectoral initiatives. These include the decision of the authorities to extend the validity of resident visas to 10 years.
The preparation for the World Exhibition is also playing a great role. Considering that World Expo 2020 will contribute to the creation of at least 270,000 jobs, demand for residential and commercial properties, including hotel real estate, will increase significantly in the medium and long term. According to forecasts, by the time of the exhibition in 2020, the population of Dubai will be 3.4 million people.
Over 90% of the population of Dubai, currently 2.4 million people, are expatriates who are attracted to the emirate by an unrivaled high standard of living and great career prospects. There is not only one of the most multinational cultures in Dubai in comparison with other megacities of the world, but also a stable demand for accommodation in real estate for residential purposes.
The emirate is rightly considered one of the most popular tourist destinations in the world and is successfully moving towards the goal of attracting 20 million tourists a year by 2020.
It is quite natural that the status of Dubai as a popular tourist destination has a direct impact on the financial results of the real estate market in Dubai, as well as the prospects for its further development.
The steady growth of the number of tourists in the emirate has a positive impact on the activity of the hotel real estate segment and creates opportunities for investors to invest in profitable investments.