Acquiring real estate in Dubai with the help of buy-dubai.ae opens up great opportunities for foreign investors: they will know how to buy property in dubai smoothly and can become residents of the UAE, have a stable income from investments.
Obtaining a property in a country with such an impressive standard of living and conducting business without paying income taxes look extra attractive. Not surprisingly, real estate in Dubai is being bought up at lightning speed.
Pros of Buying Properties in Dubai
The UAE remains one of the most sought-after destinations in the overseas real estate investment segment. The real estate market here is quite flexible and has a number of advantages.
Quality of Life
The UAE is a real island of stability and with a growing standard of living in Dubai, even a pandemic could not drastically impact the development of the country. While the whole world was in a fever from the economic crisis, in 2021 the GDP of the Emirates grew by 2.1%, and in 2022 the figure is expected to double.
The local currency exchange rate has been stable for 20 years, so the prices of everyday goods are not subject to change. Stability, constant growth, development are good trends that attract the attention of investors.
Dubai’s Tax-Friendly Environment
Investors from all over the world choose Dubai because there is no:
- high rates on the purchase of residential real estate and on income from its rental;
- annual property tax;
- capital gains tax.
There is a DLD tax (real estate tax) – 4%. It is paid once for one object, within a month after the purchase or transaction. And about 1% is administrative fees. Also within a month. As for the rest, the country is a tax free haven. It is for this reason that there is such a boom in demand around houses for sale in dubai.
It’s quite simple, when buying a property for more than $ 205,000 at the end of construction, you get a visa and the opportunity to become a tax resident. And the income tax is now equal to 0 there. In other words, having bought an apartment cheaper and sold it for more, you do not owe anything to the state now.
Low Crime Rate
The UAE remains among the safest states in the world. The system of law and order and justice is carefully organized and works effectively, providing a quick and fair resolution of criminal cases. Citizens and residents can enjoy their daily lives in peace without worrying about the threat of crime.
The country ranked second among countries with the lowest number of serious crimes (murder, rape) per every hundred people. Despite the geographical location in the Middle East, the threat of terrorist attacks in the UAE is also not observed.
World-Class Infrastructure in Dubai
The UAE prides itself on its modern road network, which ensures comfortable and safe travel. Roads in the country are maintained in excellent condition, which reduces the risk of traffic accidents and ensures road safety.
Dubai provides modern urban infrastructures, including shopping centers, medical facilities, entertainment complexes and more. This provides comfort and convenience to the daily lives of residents and residents, contributing to safety and quality of life.
The concept of smart cities is also being introduced in the city, providing modern infrastructure for residents and residents. This includes smart buildings, traffic management systems, security, and more to make life in Dubai more convenient and safer.
Apartments to Villas
Villas and apartments in the UAE are bought not only for the sake of residency, but also for profitable investments. Investments are effectively paid off, because housing prices are constantly rising. According to Reuters statistics, in the first quarter of 2022, the cost of villas and apartments in Dubai rose by an average of 11.3%.
Dubai real estate market is divided into primary and secondary. Lots from the developer at the construction stage are profitable for resale, as the price rises significantly by the time the facility is put into operation. Finished villas and apartments are suitable for rental business. Annual income – from 10%.
Easy Access to Capital
Investment in real estate is not the only way to earn income in Dubai. Here you can effectively conduct business. In addition to traditional offshore companies in the country, you can register an offshore or a company in a free economic zone (English free zone) with 0% – tax on dividends 0% – tax on capital repatriation 5% – value added tax (VAT).
Easy Access to Credit Money
By providing only 2 documents: a passport and a certificate of cash flow on accounts, you can get a mortgage loan in the amount of up to 50% of the value of the object. With an extended package of documents, the bank will consider lending up to 80%.
There is no minimum term for a mortgage, the maximum is 25 years. Loans are provided in local currency, with many banks looking favorably on large-volume loans. Here it is quite possible to count on a loan amount of up to 20 million dirhams (about $ 5.45 million). The mortgage rate is about 2.2-4.5%. For loans up to 5 years, banks usually offer a fixed interest rate, and for longer periods – a variable one.
Properties for Rent
The city holds first position in the world in terms of rental income. The ROI of Dubai real estate is very high: the return on housing is twice as high as compared to real estate in Moscow. Due to the lease, you can receive a stable income from 7% to 11% per annum, depending on the type of lease.
Taking into account the growth in prices, which is about 15% per year, it is interesting to buy off-plan on an installment plan. At the same time, there are no taxes: property, sale, inheritance.
Buying a property worth $250,000 or more allows you to get a resident visa. According to it, a foreigner can live in the UAE permanently for several years. The status of the visa and, as a result, the permitted period of residence depends on the price of the purchased housing.
Strategic Location
Strategically located at the crossroads of East and West, Dubai is a thriving center of world trade. Convenient sea and air communication with the world’s leading markets. Infrastructure and regulatory framework make Dubai a leading financial center in the Middle East.
Technological Advancements
The emirate has a first-class research infrastructure, which serves as a guarantee of the dynamic course of scientific progress. Higher educational institutions, specialized research centers, as well as research laboratories are widespread throughout the country.
The Mohammed bin Rashid Space Research Center has been operating in Dubai since 2015. It is a government organization working to implement the UAE’s space exploration program.
Over the past three years, the amount of public funding for research in the field of artificial intelligence in the UAE has grown by 70%. In May 2017, the first police robot began work in Dubai – with its help, everyone will be able to report offenses to the police, as well as pay fines.
Diverse Community
Dubai is a very tolerant, multinational and multicultural city, where representatives of more than 200 nationalities live in peace and harmony. There are many restaurants located here. In addition, the ethnic diversity of the emirate is reflected in the work of fashion designers and regular cultural and entertainment events.
Dubai is a very friendly city, however, like any other country in the world, there are local customs and traditions that should be respected. When visiting public places – shopping centers, restaurants, historical and cultural attractions – it is recommended to dress modestly.
Is it profitable to invest in local properties in Dubai?
Real estate is one of the most liquid assets in Dubai. The urban area has increased 170 times over the past 60 years, and the population has increased 80 times – from 40,000 to 3.6 million inhabitants. It is very easy to rent an apartment or a house here.
Average rental yield:
- up to 12% per annum – apartments on the coast for short-term rent;
- 8-10% per annum – studios;
- 6-8% per annum – apartments with 1 bedroom.
The advantage of the Dubai market is that many developers offer interest-free installments. Thanks to this, you can use a short-term strategy for investing:
- Investing 20% of the cost of the apartment + 4% (land tax);
- Waiting for a price increase (from 3 months);
- Resell the property to another buyer at a premium.
FAQ
Can a buyer of real estate in Dubai get a residence permit?
Yes, when buying property over AED 1 million.
What is freehold ownership?
Freehold is the type of property you buy when the buyer owns both the lot and the apartment. The owner of a wholly owned property is legally allowed to rent, occupy, or sell the property, and use it in accordance with local rules and regulations. Freehold’s goal is to encourage foreign investment in Dubai.
What are the main reasons to buy property in Dubai?
Comfortable housing, the possibility of obtaining a resident visa, investment potential.
Conclusion
The main advantage for a potential investor in Dubai is, first of all, the possibility of obtaining a tax residence with a zero tax rate. And any investor, buying property in this country worth 400,000 dollars during the year, can beat off this cost by understating taxes on income of 1 million dollars a year.
And then just make money. It is for this reason that there is now such a hype, mainly from investors from countries with a high tax base.
Also read: The Ultimate Guide to Buying a Townhouse in Dubai: Tips and Insights
