Resicom – Holiday Investment – 04-21 – LB

Property market mellows in Dubai

The property investment market in Dubai has been described as having mellowed, thanks to new government regulations and higher property transaction taxes, with the property transfer fee doubling from two to four per cent. A recent report suggests a 12 per cent fall in overall transactions, although the buy to let market remains surprisingly buoyant.

Experts, however, remain cautiously optimistic for the coming year, with Haider Ali Khan, CEO of property portal, commenting as follows: ‘Construction activity is starting to show movement again after the revival in real estate developments and infrastructure projects. Developers resumed the projects that were on hold, thanks to the recovering property prices, a jump in bank financing for construction and the returning trend of off-plan sales.’

Foreign investors made almost 50 per cent of property transactions in Dubai during 2014, with the second largest group being from the UK. The average price of a one bedroom flat in Dubai’s upmarket downtown area was about £500,000 as of February 2015. And while prices are not expected to rise as rapidly as they did in 2013, they are expected to increase between 10 and 15 per cent every year until 2020. So for those with an eye for a long-term investment or who intend to stay and work in Dubai over the next five years, now is actually a good time to buy, with a 50 per cent increase in property value all but guaranteed in what remains a solid and stable realty market.


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