Dubai's real estate market is attracting a growing number of European investors. The emirate's higher returns on rentals and capital appreciation appeal to these investors. With the Ukrainian crisis impacting the European economy, many Europeans are looking to invest in Dubai, where there are better rates and safer investments.
Western European countries, such as Germany, Switzerland, France, and the UK, are leading the way. This reflects in the highest number of property developers coming from these areas. Yet, the major investors in Dubai's property market are Indians, Pakistanis, British, and Gulf nationals, along with UAE citizens. Recently, Russians have also invested billions of dollars in UAE real estate. They are looking for a safe investment.
Foreign fund inflows have strengthened the emirate's property market. In March 2023, these foreign fund inflows almost reached nine-year highs. Dubai-based Samana Developers have stated that they are seeing more buyers from France and Europe. This contrasts the recent trend of Russian, Chinese, British, Pakistani, and Indian buyers in the past. The whole of Dubai's real estate market is also experiencing this trend.
REASONS WHY EUROPEANS ARE INVESTING IN DUBAI
Najmeh Jafari, general manager of Samana Developers, states that the Europeans investing in Dubai are from a wide range of countries. These include Germany, France, the UK, the Netherlands, Sweden, Switzerland, Austria, Belgium, and Norway.
He highlights several reasons why more Europeans are investing in Dubai's real estate, including:
- Low tax rates
- Luxurious and attractive lifestyle
- Cheap property prices and higher returns
- Ease of doing business
- Political and economic stability and safety.
Ayman Youssef, vice president, of Coldwell Banker UAE, adds that the UAE's property market has managed to maintain attractive prices. This is alongside higher yield/return per unit compared to most European countries.
Today, investors can get up to 8% returns, which is high compared to what European countries can currently offer. The UAE's attractive market also encourages people to invest in property to make it their permanent home. The Golden Visa, 100% ownership right, business opportunities, and other factors are key here. These schemes are encouraging more people to invest in the emirate and make it their permanent home.
HOW MUCH ARE EUROPEANS INVESTING IN DUBAI?
Najmeh Jafari observes two distinct categories of investors from Europe. One focuses on high-end residential properties. They also love to live in Downtown Dubai, Dubai Marina, and Palm Jumeirah.
In contrast, the second category comprises pure investors. These high-end investors buy properties that are often between AED4 million to AED80 million or even higher.
Jafari explains that investors like to go for a good payment plan to buy property, making it easier for them to pay. But those who wish to move to Dubai will pay as they want.
So, these two distinct categories of European investors have different requirements. People who settle in Dubai with their families are a different story than those who invest to transfer and safeguard their money.
Overall, Dubai is an attractive destination for all those Europeans who want to buy property and start a business. This is why the number of European investors in Dubai's real estate market is rising every day.
LOOKING TO ENHANCE YOUR REAL ESTATE KNOWLEDGE?
Sign up now to the Cityscape Intelligence newsletter here