Haider Ali Khan, CEO of Bayut, a property portal operating throughout the Emirates believes that 2018 will present opportunities for buyers and renters as more inventory arrives on the market. The year 2017 was a buyers’ and renters’ market with sales prices and rents lower across many areas. In 2018, inventory is picking up and providing attractive opportunities for a large base of consumers looking to own a home in UAE.
The real estate market appears to be at the bottom of the cycle, and a price rise is happening at present. Developers are looking to reduce the square footage of apartments to make their price tag more affordable, and this has already started in Dubai South and Dubailand. Buyers will have to get used to smaller floor plans when looking at affordable options.
Luxury high rises in popular areas are still commanding excellent prices. In Dubai, Marina owners are paying a median of $427 per square foot and in towers like La Reve or Silverine median prices are around $600 per square foot. Median prices in the iconic Burg Khalifa are between $800 and $1,100 per square foot.
There are many reasons why buyers are choosing to invest in Dubai property. According to Luxhabitat, a high-end real estate brokerage in UAE the main reasons are:
• No property taxes. From the beginning of 2018, all residential property sales and leases are exempt from Value Added Tax.
• Improved infrastructure. The run-up to the huge Expo 2020 will create over 250,000 jobs with an investment of over $6.6 billion in infrastructure projects. The govern-ment’s initiative in making it a smart city is far reaching with their city being at the forefront of technology with transportation solutions and driverless cars.
• Rental returns. Even in the recent difficult times, rental returns are still attractive. Areas like Dubai Silicon Oasis and Dubai Sports City are achieving rental yields of between 8 percent and 9 percent. Also, investors spending approximately $300,000 are eligible to apply for a residence visa in UAE.
• Safety and Stability. Dubai offers easy connectivity to cities in Asia, Africa and Europe, and that’s why it’s a popular city with individuals and huge companies like Snapchat. From a business perspective, Dubai represents an attractive and stable platform from which to do business.
• Transparent Real Estate Authority. Since 2006, the government has allowed foreign ownership in free-hold areas and the Real Estate Regulatory Agency has improved the transparency of the real estate market.
2018 looks to be a much better year than the past two years, with more opportunities on the horizon for buyers and renters.