Dubai is a superlative experience, especially for those in search of a global investment hub or dream homes. Since real estate is one of the strongest facets of the economy, buying luxury properties in Dubai is an attractive option for high net worth individuals (HNWIs) across the world.
But, when it comes to the question of ‘what makes Dubai the best place to buy luxury homes’, there are many factors and preferences to be considered. In this post, we’ll be sifting through these layers to unravel all the reasons why it’s a good idea to buy luxury houses in Dubai compared to other parts of the world.
WHAT MAKES DUBAI THE BEST PLACE TO BUY LUXURY HOMES
An increasing number of global citizens belonging to different nationalities, choose Dubai as their second home. A lot of them see it as the perfect place to buy properties for investment. Let’s look at the factors that make Dubai an attractive real estate investment hub and how it compares to the other international cities in the world. With the introduction of Dubai’s long-term visas for real estate investors, there are additional advantages for those buying luxury property in the area.
THE AFFORDABLE LUXURY QUOTIENT
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irst things first, Dubai offers incomparable value for luxury real estate. Given that foreign homeownership in Dubai came into effect in 2002, Dubai is a relatively new entrant in the league of global luxury property hubs like Singapore, New York and London. The emirate boasts mega real estate developments designed to cater to individuals with a penchant for high-end living.
Even with the opulent lifestyle that is commonly accepted as the standard in Dubai, the city remains highly affordable. Knight Frank’s 2019 Wealth Report reveals that despite the fluctuations in the real estate market, luxury homes in Dubai are far cheaper in value than those in other key cities in the world.
The Knight Frank Report analysed the luxury residential property worth USD 1M (AED 3.6M) that one could purchase in major luxury destinations in the world.
For $1M you can buy the following properties around the world:
- Monaco: 172 sq. ft. of prime property
- Hong Kong: 237 sq. ft. of prime property
- London and New York: 334 sq. ft. of prime property
- Singapore: 388 sq. ft. of prime property
- Geneva: 441 sq. ft. of prime property
Even cities like Paris, Shanghai and Sydney offer less than 620 sq. ft. of luxury property for the same budget.
Dubai, on the other hand, offers more than twice as much, with $1M getting you a whopping 1,539 sq. ft. of prime property at an astonishingly low price per sq. ft. of USD 650 (AED 2,400) on average.
Some might argue that Dubai, being relatively new to the league, lacks prime property developments compared to the long-standing prominent key players, accounting for the higher affordability.
But that’s not the case. Dubai is home to some of the most superlative property developments in the world that match and often surpass the standards of those found in cities like London, Geneva and Singapore. What sets Dubai apart is its unparalleled portfolio of prime properties, which gives buyers the ultimate benefit of choice – but that’s just one aspect of it.
And this affordable luxury is not just restricted to the price of properties. High-value commodities including gold and petrol are known to be historically priced competitively in Dubai.
People are able to enjoy a high standard of living with plenty of help in the form of nannies, gardeners and more with relative ease. Home cleaning services in Dubai are on average 20% cheaper than in other popular cities such as New York and London. And nowhere else in the world can you get petrol delivered to your home for barely any extra cost!
IT’S EASIER TO BUY LUXURY PROPERTY IN DUBAI
Another important contributor to Dubai’s standing as an ideal destination for investing in luxury properties is the ease of doing business. Besides its reputation of being a haven of upmarket communities and luxurious properties, the laws and the taxation system in Dubai is investor-friendly. Plus the emirate is an undisputed dynamic business hub in the region.
Foreign real estate investors in Dubai majorly benefit from the capital and income-tax-free system and the absence of additional levies on property purchase. So whether you’re buying luxury homes in Dubai for personal use or as an investment, you can count on simpler transactions and processes.
This is a big advantage when you compare the emirate with cities like London, Paris, Geneva and Monaco considering the rapid property tax reforms these cities underwent, levying the additional tax for foreigners on the purchase of luxury properties. All this combined with healthy ROIs in the emirate’s residential market, steady population growth and an ever-increasing standard of living make purchasing luxury homes in Dubai seem like the ideal investment decision.
THE REAL ESTATE MARKET IS THRIVING
According to the data collected by the DLD, real estate transactions in 2019 went up by 33%. There was a notable increase in the price per sq. ft. for luxury properties, hinting at a rising demand trend for luxurious homes. The same growth reflected in the H1 Dubai Property Market Report for 2019, where investor interest was more inclined towards upscale properties in Downtown Dubai, Palm Jumeirah and the Arabian Ranches.
A New World Wealth market research ranked the UAE as one of the top five countries preferred by millionaires. Dubai being the financial hub, is the most preferred migrating destination for wealthy expats and HNWIs. The high influx of HNWIs brings in important wealth inflows, where most of it is invested in Dubai’s prime property market. The latest AfrAsia Bank Global Wealth Migration Review reveals these luxury properties mostly include well-integrated residential communities like the Dubai Hills Estate and Mohammed Bin Rashid City that have recently gained popularity in the UAE as a whole.
THE IDEAL LOCATION OF DUBAI
Part of Dubai’s growing charm for investors is its ideal location. The emirate gives businesses the best of both worlds – the east and the west. Dubai’s time zone is one of the most convenient time zones for businesses that want to expand globally, giving them a centre point to match the timings of both the east and the west.
Besides that, Dubai’s location provides global connectivity in terms of travel. Simply taking a two to eight-hour flight from Dubai can land you in key cities in Asia, Europe and the Middle East. Combine all this with the long-term real estate visas and there is little that can hold a businessman and/or an investor from investing in Dubai as their long term home base.
THE LUXURY OF CHOICE
While there are several essential layers working in Dubai’s favour, the city’s most attractive offering remains the diversity of prime properties available for purchase. From lavish villas and fully-serviced apartments to premium penthouses – Dubai’s luxury properties’ portfolio is unrivalled. The prime properties for sale in Dubai come in a massive choice spectrum, where investors can choose the areas, property types and the price they wish to pay for a luxury property.
We’ve already established the fact that luxury properties in Dubai are priced far less than other prime cities in the world. Luxury real estate in Dubai can be broadly divided into apartments and villas.
Top Areas to Buy Luxury Apartments in Dubai
PRICE PER SQ FT
Jumeirah Bay Island
According to the data on Bayut’s listings for luxury properties in Dubai, Downtown Dubai, Jumeirah Bay Island and Palm Jumeirah are the most popular areas to buy luxury apartments in Dubai. The high-end apartments in Downtown Dubai, with price per sq. ft. of USD 596 (AED 2,189) are the most popular option for investors. Jumeirah Bay Island and Palm Jumeirah with their respective price per sq. ft. of USD 918 (AED 3,372) and USD 1,189 (AED 4,367) are other popular choices with HNWIs looking for upscale flats. Apartments in these areas offer a good ROI of over 5%.
Other areas in Dubai which are popular for their luxury apartments include Dubai Marina and Bluewaters Island.
Dubai also offers an extensive range of penthouses. Anyone in search of luxury penthouses in Dubai can find them in Palm Jumeirah, Bluewaters Island, Downtown Dubai and Dubai Marina. Prices for Dubai luxury penthouses vary between USD 272k (AED 1M) and USD 25M (AED 93M) depending on property size and your area of interest.
Top Areas to Buy Luxury Villas in Dubai
PRICE PER SQ FT
The World Islands
Jumeirah Bay Island
Moving on to the luxury villas in Dubai, the areas that garnered most investor interest include Emirates Hills, Palm Jumeirah, The World Islands and Jumeirah Bay Island. Emirates Hills offers affordable luxury with lavish villas available for as less as USD 459 (AED 1,686) per sq. ft., while Jumeirah Bay Island remains the most expensive option with price per sq. ft. of USD 1,032 (AED 3,790).
While the price per square foot is lower in Emirates Hills, since the average size is often much larger, these properties do tend to work out more expensive. However, with golf course access, premium finishing and the backing of the leading developer in the UAE, it’s easy to see the appeal of investing in the Beverly Hills of Dubai!
The price of luxury villas for sale in Dubai can go well over USD 41M (AED 150M) depending on the size and amenities available.
All the above-mentioned areas rake an average ROI of more than 3%, with Jumeirah Bay Island being the most prominent, offering 4.3% returns on investment. Other areas worth considering for include Mohammed Bin Rashid City, Al Barari and Arabian Ranches.
To sum it all up, Dubai remains a highly competitive option compared to global cities like Sydney, Singapore, London, New York and Shanghai. The emirate offers world-class luxury living standards at a price far more affordable than any other cosmopolitan city in the world. Hence, investing in Dubai’s luxury properties remains a lucrative option for investors and HNWIs worldwide.
Source : https://www.bayut.com
Images : https://www.bayut.com