Resicom – Holiday Investment – 04-21 – LB

Dubai Serviced Apartments Investment

Dubai has long been a favourite for property investment, but now serviced apartments investment offers an up and coming investor route into the market.

Serviced apartments have grown in popularity over the last few years, as both purchasers and developers are capitalising on the growing strength of Dubai’s tourism sector.

Dubai already attracts nearly 15 million visitors every year and are aiming to reach 20 million visitors per year by 2020 when the World Expo 2020 is due to be held.

The requirement for hotel rooms and serviced apartments is therefore strong and growing by the year.

The residential population of Dubai grows at 5 per cent per year, so around 20-25,000 residential properties need to be added every year to cope with the population increase, let alone the increase in visitors.

Serviced apartments are widely seen as the answer to help cater for the increase in visitors leading ultimately to the World Expo 2020.

Niall McLoughlin, senior vice-president of Damac Properties, commented: ‘The current supply of hotel apartments in the deluxe category stands at 9,519, according to the Department of Tourism and Commerce Marketing, which is much less than what is needed for the anticipated 20 million visitors per year by 2020. So again, the supply-demand imbalance exists.’

Serviced apartments can often be an attractive investment due to their hassle-free nature of management that can still bring good investment returns of up to 8 per cent.

As well as healthy returns, investors can also stay in the investment property for a period of usually 1-2 weeks per year, which means that overseas property investors can also use the property as a holiday home.

McLoughlin added: ‘For investors who reside abroad, a serviced apartment represents a hassle-free and lucrative opportunity, with booking, maintenance and housekeeping taken care of through a rental pool. The apartment can also be used as a vacation home and is more suitable for families.’

For those overseas property investors that want a hassle-free investment property experience, serviced apartments may be the answer.

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