Why are Indians Buying Property In Dubai?

Real estate sales in Dubai reached AED 20.8 billion as of July, an increase of 61.7 percent over the same month in 2017. In recent research, it was said that Indians topped the list of purchasers.

Central Dubai. The real estate industry in Dubai is very tightly controlled. A rigidly enforced Real Estate Regulation Authority protects investors and holds developers responsible.

Dubai has experienced an extraordinary rise in real estate demand as a result of changes to the Golden Visa restrictions. Total real estate sales transactions increased by 61.7 percent in July 2022 compared to July 2021, reaching a staggering AED 20.8 billion. According to a new analysis by BetterHomes, in terms of purchasing real estate in Dubai, Indians will lead the pack in 2022, followed by the UK, Italy, and Russian billionaires. In 2022.

Indians Buying Property In Dubai

On April 18, 2022, the UAE Cabinet approved changes to the nation’s immigration and residency policies. These changes included the addition of a number of new visa types and the introduction of additional programs aimed at making the UAE a more desirable place to live, work, and invest. The new regulations will be in effect starting in September 2022.

The investment limit has been reduced under the new regulations from its previous high of AED 5 million (INR 10.4 crore) to AED 2 million (INR 4.2 crore). The demand for real estate in Dubai has skyrocketed as a result of this significant decrease. The overall number of sales transactions increased by 61.7 percent in July 2022, reaching a staggering 20.8 billion. The total sales value increased by 85.5 percent from July 2021 figures.

And wealthy Indians are buying a lot of real estate in Dubai. New research from the property management company Betterhomes indicates that buyers from India top the list of countries purchasing real estate in Dubai, followed by purchasers from the UK, Italy, Russia, and France.

According to data from the Dubai Land Department (DLD), Indians have been among the Top 3 countries to purchase real estate in Dubai since 2004, having done so in the previous five years (2015–21) for a total of AED 83.62 billion.

Indians made up 16 percent of Dubai’s property sales in terms of volume in 2019 and invested more than AED 8 billion in the industry.

Indian citizens have reportedly already invested $3 billion into a number of freehold and leasehold real estate developments in the city, according to DLD. Given the emirate’s strategic position, excellent investment and rental returns, capital appreciation, and transparent rules, Indian purchasers have continuously been the largest foreign investors in the real estate market, according to DLD.

Rental income: What is the main incentive for purchasing real estate in Dubai, besides the Golden Visa? Average rental returns in the city are 7%. Compare it to Hong Kong (2.3%), Singapore (2.5%), London (2.6%), New York (2.8%), and Singapore (2.5%). Additionally, there will be a healthy capital appreciation because the Dirham is pegged to the US Dollar and is therefore unaffected by currency movements.

RBI remittance regulations: An Indian investor is permitted to formally transmit $250,000 to Dubai each fiscal year under the Reserve Bank of India’s “Liberated Remittance Scheme.” A couple is allowed to transfer $500,000 per year under this program for use in Dubai Housing

The Dubai real estate market is also very tightly controlled. An authority that firmly enforces real estate regulation is responsible for protecting investors and holding developers accountable.

Indians make up 43.5 percent of the UAE’s overall population, and the UAE sends India individually between $12 million and $15 billion yearly in remittances.

Impact of CEPA: Within five years, it is anticipated that the historic India-UAE Comprehensive Economic Partnership Agreement (CEPA), which went into effect on May 1, 2022, will boost the value of bilateral trade in goods to over $100 billion and in services to over $15 billion.

Because the UAE currently permits 100 percent foreign ownership in 122 economic activities spanning 13 sectors, Indian enterprises may easily relocate their headquarters to Dubai. For Indian manufacturing businesses in important domestic industries, the opportunity to enter the UAE with no duties will be a strong inducement to establish a foothold there.

Dubai’s Real Estate Trends

The overall number of sales transactions increased by 61.7 percent in July 2022, reaching a staggering 20.8 billion. The total sales value increased by 85.5 per cent from July 2021 figures. DXBinteract.com reports that there were 7,138 sales transactions in July (4,843 for apartments, 1,536 for villas, 342 for commercial, and 417 for plots). Business Bay, Downtown Dubai, Dubai Marina, Dubai Creek Habour, and Palm Jumeirah were the Top 5 performing districts by sales volume.

The overall volume of transactions this year (until May 2022) was 30,903, the highest level since 2009. The average price of residential property in Dubai has increased by 10.9 percent so far this year.

Although the average price per square foot for apartments was AED 1,102 (INR 23,500) and for villas was AED 1,307 (INR 28,000) in May, the current rates are 25,9% and 9.5% lower, respectively, than the real estate highs seen in late 2014, according to CBRE.

At AED 2,045 (INR 43,800), Downtown Dubai apartments had the greatest average sales rate per square foot, while Palm Jumeirah villas had the highest average sales rate per square foot at AED 3,207 (INR 69,000).

Luxury Hotel Residences for Investors

Investors may purchase studio and one-bedroom flats at the opulent 5-star Cote d’Azur Hotel, which will open in September 2022 and is situated in the heart of The World Islands in Dubai. A one-bedroom apartment on the first floor costs AED 2,480,273 (USD 675,253) and has starting square footage of 457 for AED 1,385,920 (USD 377,316).

The return on investment for a studio apartment on the third floor, which costs AED 1,404,800 (USD382,389), will be a guaranteed 8.33 per cent each year for 12 years, according to worldislandsdubai.com. The hotel will manage the rental, and the rental income is tax-free.

What has changed for owners of Golden Visas?

  • Those who qualify for the Golden Visa include investors, business owners, scientists, exceptional students, and recent graduates, front-line heroes, and humanitarian pioneers.
  • Given permission to live in the UAE for 10 years (up from 5 years). Upon expiration, the visa, which also serves as an entrance permit for six months, may be renewed.
  • Sponsor limitless support services, such as maids, as well as family members, including the husband and children regardless of their age.
  • Is able to continue living in the UAE without the help of a sponsor or job.
  • The Golden Residence can be used for an unlimited amount of time outside the United Arab Emirates. Prior to this change, visa holders who traveled outside of the UAE were required to return every six months.
  • Family members of the original Golden Residence visa holder are now permitted to remain in the UAE until the permission expires.
  • In addition, under the new legislation, businesspeople and investors can obtain a 10-year residency visa by making an investment in a startup in the UAE.
  • On the basis of a recommendation from the Emirates Scientists Council, scientists and researchers with significant accomplishments and impact in their respective professions may be eligible for the Golden Visa.
  • From the time the application is submitted until it is approved, the processing time for the residency application is three months.
  • Golden Visa holders will now receive an exclusive government-issued discount card called the Esaad card, which gives exclusive access to offers and discounts on the purchase of cars, reduced premiums on health, and insurance plans, and offers on dining, lodging, and spa treatments. This card was previously only available to select government employees.