Why Dubai’s Villa Market is a Safe for Long-Term Investors
Dubai's villa market has seen robust and prolonged growth over the past few years, driven by two distinct clientele: high-net-worth individuals looking for a luxury family home and long-term investors looking to extend their real estate portfolios.
Dubai's villa market has proven to be a safe bet for the latter, with high returns and high rental value revenue streams. So, what else has made it such a strong contender for inclusion in an investment portfolio?
The ’Golden Visa’ – a driving force behind Dubai’s meteoric growth
One of the biggest draws for those wanting to make Dubai their home has been the advent of the Golden Visa. This has made it much easier for foreign nationals to live, work, or study in the UAE. Primarily aimed at high-net-worth individuals, it has encouraged entrepreneurs and business leaders to make Dubai their home and allowed them to invest in the country's future.
Part of the Golden Visa includes a long-term residency permit for those who want to invest in high-end property portfolios, including luxury villas.
Real estate investors must demonstrate that they own one or more properties worth at least AED 2 million to qualify. This has encouraged an unprecedented level of investment in the property sector over the last few years, especially as investors can also benefit from the high rental returns on offer.
Robust legislation designed to protect the assets of property investors is also a big draw in Dubai. In particular, the Dubai Property Law No.7 of 2006 lets expats buy freehold properties in specified areas. Stringent regulations surrounding tenancies, the settling of property disputes, and transfers of ownership also make the Emirates a safe place to do business.
A better level of return
Dubai represents real 'value for money' compared to other international capitals like London, Paris or Berlin. Not only is land cheaper (currently at around AED 1,448/ft²), but the potential for a higher return on your initial investment makes it a more attractive proposition.
Growing demand for more spacious living post-COVID also makes luxury villa developments more attractive, as do the considerable rental returns available.
Current developments, such as the innovative Bo Monde lifestyle experience created by Tilal Al Ghaf, meet those needs. Not only do they offer beautiful luxury villas suitable for families, but they have also focused on building communities. These are safe spaces with all the facilities a young family needs, including schools, green spaces and easy access to amenities, making them extremely attractive propositions.
For investors, this blue-sky approach to development can result in much higher returns in the long term and for a lower level of initial capital investment than a like-for-like project in, for example, London or New York.
The impact of upcoming infrastructure projects such as Expo City and the new airports planned for Dubai also positively affects villa prices.
The future looks good
Dubai's continued development, driven in part by proactive government strategies and an influx of international businesses making the city their home, will have a knock-on effect on villa prices. This steady level of real estate growth, which has been sustained for the last 47 months, shows no signs of abating.
In conjunction with the willingness of lenders to provide attractive mortgage offers with tempting interest rates, real estate investment is a ‘no-brainer’ for investors looking to build a strong portfolio that will show generous returns over the next few years.
Find out more from Tilal Al Ghaf
Our Bo Monde neighbourhood represents the very latest in real estate investment opportunities. To find out more, browse our website or contact us and talk to one of our advisors today.
