Luxury properties like One at Palm Jumeirah in Dubai have become a hot trend among investors and end users in the Emirati real property market. Consumer interest in the residential units of the fast-growing metropolis is justified by the high standard of living, developed infrastructure, and picturesque coastal tourist destinations. Anyone who is considering buying a home in this sunny city should be familiar with the pros and cons of such a transaction.
Pros
The metropolis offers plenty of benefits, attracting both local and international buyers. The following factors are among them:
- High rental yield.
- Growth of population.
- World-class infrastructure.
- No taxes.
- Safety and stability.
- Strict rules.
- An aviation hub.
- Booming tourism industry.
- A visa for a real estate investor.
- World-class sports events.
High rental yield
The city shows one of the highest rental incomes in the world. However, the cost of acquiring a local property is significantly lower compared to other global locations.
| A city | The net rental income (US dollars) | The rental income (%) |
| Dubai | 29,100 | 5.82 |
| New York | 19,550 | 3.91 |
| London | 16,050 | 3.21 |
| Singapore | 14,150 | 2.83 |
| Hong Kong | 14,100 | 2.82 |
Growth of population
It is one of the fastest growing cities in the world. Its population has grown by 1000% in just 40 years. As at 2022, almost 3,000,000 people live in the metropolis. Most of them are emigrants who have come here from more than 190 countries. Experts predict that this figure will double in the next decade.
World-class infrastructure
This place is a modern, world-class metropolis with record-breaking skyscrapers, bustling shopping centers, and a high-tech transport network. The local metro is the longest unmanned metro network in the world, and the city continues its quick development.
No taxes
According to the UAE VAT Law, all investments for living, such as housing investments, are considered residential and have to be subjected to 0% VAT. The first purchase of a property within three years of post construction is also subject to 0% VAT.
Safety and stability
The World Economic Forum ranked the UAE as the third safest country in the world. Active government initiatives and a stable system of legal order attract immigrants and foreign investors.
Strict rules
The Real Estate Regulatory Agency (RERA) that enforces compliance with strict rules and regulations. A transparent policy protects investors’ rights and helps to the long-term growth of the real estate sector.
An aviation hub
The city is strategically located. Nearly 70% of the world’s population is within an 8-hour flight for the locals. This makes Dubai International Airport the world’s busiest passenger hub. Around 85,000,000 people pass through it every year.
Booming tourism industry
Dubai has something for everyone: a desert safari full of adrenaline, luxury spas, huge shopping malls, thrilling wildlife tours, skydiving, and exciting water park rides.
A visa for a real estate investor
Buyers who purchase property worth more than AED 1,000,000 can apply for an Investor Visa. It gives an opportunity to issue a UAE Citizenship Identity Card, a UAE driver’s license, and a residence permit for family members.
World-class sports events
The metropolis hosts the most influential sports events in the world. With this, the city is at the center of attention throughout the year. These events are the Omega Dubai Desert Classic golf tournament, the Dubai Tennis Championship, and the Dubai Rugby Championship.
Cons
One of the things to consider when acquiring a local property is the initial costs connected with the process. For example, if someone purchases a housing unit directly from the developer, he must pay mandatory fees to the Dubai Land Department. They include a 4% fee of the property value, a fee for issuing an ownership certificate, and an administration fee.
In addition to the administration fee, buyers who take out a mortgage also have to pay a registration fee, which is 0.25% of the loan amount, to the Land Department. However, this news will appeal to investors who plan to invest in cash only. The fee for registering mortgages will not apply to them.
Assistance with buying property in Dubai
The Dubai real estate market offers various profitable investment options. To find properties with the best return on investments, visit the official AX Capital website. Representatives of the agency, with a solid track record, help buyers understand the intricacies of a real estate transaction and accompany them through all stages of this process.