The growing economic trajectory of Dubai makes it a top destination for investors looking for real estate investment opportunities. Choice locations include Damac Hills, Dubai Marina and Downtown Dubai.
Just last year, Dubai made news following the record $10 million investments in over 400 homes. If the metrics by Statista play out, the UAE’s real estate market will reach a record valuation of $0.71 trillion by the end of 2024.
Strategic selection of where to invest in and the type of property to buy can make all the difference in how much ROI you make.
Popular Real Estate Investment Opportunities in Dubai
Real estate is one of the most lucrative businesses in Dubai. As the Emirates is a hotspot for people looking to invest, this location is an ideal place. Now, committing to the industry requires paying attention to detail and being futuristic with your investments.
1. Commercial Property Investment Opportunity
The commercial aspect of Dubai’s real estate market is one of the most popular due to the influx of more people into the country. From tourists to those applying for residency, the coming of more people into a location is a sign that more business opportunities can thrive there.
Here’s why you should invest in Dubai’s commercial real estate market:
- Thriving Market: commercial properties are in demand and will continue to be for a long time to come. Business owners will need places to do their daily transactions. Offices, warehouses and factories are some examples of buildings you can set up and make money from renting or leasing.
- Different Income Potentials: commercial properties can be rented out to businesses for a fee. The same can be leased for a specific duration.
- Commercialize Everything: these properties are not limited to offices and warehouses. Hospitals, shopping centres and labour houses can also be commercialized.
2. Invest in Dubai’s Residential Property Market
Just as people need a place to do business, so does having a roof over their heads is important. Buying a residential property and putting it on the market for rent can be a good investment decision.
This market is flourishing, as is evident in the villas and apartment purchases. Profitable properties to invest in are apartments, condos and villas.
Also Read: What is the Difference between Mutual Funds and Bonds? Where to Start First
3. Start a Real Estate Business in Dubai
Think the commercial and residential property route will take some time before you see some profits? Well, go where the “big bag is” – start a real estate company. Getting a property ownership certificate or having a valid UAE residence visa gives you a shot at making this happen.
Getting the necessary paperwork and approval enables you to be in the business of building different types of buildings.
4. Invest in Tourism
People live in Dubai. People also travel to sightsee in Dubai. The latter opens up a real estate investment opportunity. With millions of visitors coming in yearly, having a place for these people to lay their heads during their stay can be one of the most profitable business ventures.
Aside from investing in tourism facilities, you can also offer accommodation services, ranging from short-let apartments and boutique hotels. Investments in theme parks, luxury resorts and entertainment centres also bring in great returns.
5. Flip Real Estate Properties in Dubai
This is by far one of the riskiest yet profitable real estate investment opportunities in Dubai. It demands more capital, but if you have a defined business model, pitch to investors to buy into the idea.
Flipping real estate properties entails buying low-cost buildings and selling these off when the value spikes.
Another way to double your income with this model is to rent up these properties for rent or lease and sell them later.
Top Considerations Before Investing in Dubai’s Real Estate Market
No doubt that the UAE is a top destination for real estate investments, especially now that there is a high demand for luxury properties following the relocation of high-net-worth individuals.
Choose an Ideal Location
As you know, location is very important when making a real estate investment decision. Dubai has choice areas, such as:
- Jumeirah Village: this is an ideal location for building or purchasing accommodation structures, such as short-let apartments and boutique hotels.
- Dubai Marina: this is the best location for setting up residential properties, as well as buildings and offices.
- Al Barsha & Downtown Dubai: these locations in Dubai are famed for the array of grand malls, hotels and related luxury accommodations.
- The Palm Islands: setting up your real estate construction business here is a good start to building residential homes, such as houses and villas for the rich in Dubai.
Diversification is Important
Don’t make the mistake of splurging all your resources on getting invested in a certain kind of property. Diversifying to other aspects gives you more coverage and could be a hedge to staying afloat if things don’t go as planned.
Which to Invest in: Ready-to-Move or Off-Plan?
There are two kinds of real estate investment opportunities in Dubai: off-plan and ready-to-move.
- Ready-to-move: also called resale properties, these are the already-constructed buildings you can purchase and put to good use.
- Off-plan: these properties haven’t been completed.
The difference between the two is the resale properties can be paid for and used almost immediately while the off-plan units are yet to be delivered. Another difference is the lower cost of getting an off-plan property when compared to a completed unit.
Set a Budget
The barriers to investing in Dubai can be higher for non-residents. You must have obtained an Investment Visa as a part of the eligibility requirements.
Typically, you need a budget of AED 1 Million to enjoy a stay and buy properties. The conditions for getting the visa include:
- Investing in a property valued up to AED 1 Million.
- The property must not be leasehold or off-plan.
- Mortgaging is possible, only if the value of the property doesn’t exceed 50% of the mortgage.
Also Read: 7 Investment Mistakes You Must Avoid in Dubai
Final Thoughts
Dubai’s property market has been on a steady increase, with over 10% annual jump recorded in the last couple of years. The influx of tourists, relocation of more people and the growing investments from high-net-worth individuals are some reasons for this spike.
By identifying the market demand, coming up with ideas on filing some existing gaps and choosing the right type of property; you can be sure of reaping a massive ROI in the years to come.
