Coronavirus pandemic has certainly affected each and every life in the world and mostly in a negative connotation. India, let alone the world, is still set for recovering from the post-pandemic phase. With the vaccine developments against COVID-19, it is now getting better, and lives have become normal with extra precautionary measures.
Investors are already gelling for the opportunity to invest their funds in late 2020. Among all the doomed things, the silver lining is that Dubai’s properties are correctly priced and affordable, and the basic rule for the investor is to buy low and sell high. Here are some of the reason why it is the best time to buy properties in Dubai for Indian National:
1. Long term residency visas for investors
Recently, the UAE government has provided relaxation in the visa rules. They have announced the plans to issue five and ten years visas to entrepreneurs, professionals, and investors, mainly focusing on specialists in the research, medical, technical and scientific field.
This also included enabling expatriates to secure five-year retirement visas if they own property worth at least 2 million AED or have 1 million AED in savings or currently have an income of more than 20,000 AED per month. This has made UAE a desired place for retirement as well as employment with the investment opportunity.
With growing unemployment in India and proximity towards Dubai, this seems to be a much better option for businessmen and professionals in India to invest in real estate in Dubai.
The decision on longer-term visas will help ex-pats – especially Indian ex-pats to have the flexibility to continue working and staying there generally for a limited time for work visas, which will ultimately lead them to think of buying a house or property there seriously.
2. Post COVID-19 recoveries
Though the COVID-19 pandemic has not been fully eradicated, a part of this has ended with developments in medical science regarding the vaccine. The world is gradually recovering from the repercussions of the pandemic, with economies moving forward. UAE has been affected in the milder part than other developed countries due to the country’s fast reactive measures and strict rules and regulations. This has helped the country short live the restrictions in the operation of the businesses and economy.
With many lockdowns around the world being eased and the emirate’s travel and tourism industry open, Dubai is in a prime position to gain a lift from visitors and income from tourism. The Expo 2020, which was delayed due to the global pandemic will also happen this year in early 2021, and continued inducement of the UAE government will also help the economy recover relatively quickly. Projections by experts suggest that this may happen in early 2021.
As Dubai is known for its buoyant rental market and tax exemption in case of rental income, it will be further boosted by the expo, where the demand for the rental properties will skyrocket before and during the expo’s duration. Therefore, investors can gain short term capital appreciation if they invest in the properties now in Dubai.
3. Underpriced Market
There is no doubt that the Dubai property market is fairly underpriced compared to that of the major cities worldwide. In Dubai, the real estate prices fell for five years before the happening of the pandemic. With the luxury lifestyle they offer and the state of the art infrastructure, the UAE is highly appealing to global investors. Also, Dubai is positioned as a global aviation hub and is accessible from almost everywhere, making it a prime destination for people around the world to stay in even if that is for a short span of time.
As per the reports of popular sites like Bayut and dubizzle, the average prices in the most popular areas in Dubai like Jumeirah Village Circle, Bur Dubai, Al Nahda, Dubai Silicon Oasis, and Deira have decreased between 9% to 16% compared to that of 2019. The report further states that Jumeirah Village Circle is ranked as the most popular for affordable apartments in Dubai in 2020 recording the sale of 332 transactions which has caught attention for its family-friendly amenities and access to major highways.
Supply continues to build, and Jones Lang LaSalle (JLL) has forecasted that 53,000 houses are due to be delivered this year and there would be an increase of 9% on the total stock of 595,000; this shows that UAE has an oversupply in residential units, which would put downward pressure on the real estate market. Therefore it will take some time before the market bottoms out despite the demand from the property investors picking up.
Since the prices are under, it will take no time to value the property at its right price so for any investor the basic rule is to buy the property when it’s under and sell when it’s over.
Further, with the prices of real estate properties skyrocketing in Mumbai and Delhi, Indian investors will benefit if they buy properties in Dubai rather than in their country, as the market will not remain constant shortly. The values of the properties in Dubai are expected to go up as projected by the experts once the supply is fully adjusted.
4. Easy Procedures
It is comparatively easier for any foreign national to apply for a visa to the UAE. A six-month business visa is easily provided to you if you have adequate proof of sufficient funds. Any foreign national can also purchase property in freehold areas like Dubai Marina, Downtown Dubai, Palm Jumeirah, etc., with much ease and fewer formalities, unlike many other countries. However, the non-freehold areas are accessible to the citizens only. If the property is being bought off-plan, i.e., new development, then passport copy is all that’s needed with the deposit of down payment and will need to furnish the remainder of the installments and eventually go to the land department to transfer the ownership deed in their name. There are no special permits required or lengthy paperwork for approval to make the purchase.
Off-plan transactions are especially very popular in Dubai as it is cheaper than the ready property. According to the report of Bayut and Dubizzle, off-plan accounted for 52 percent of the total property transaction which amounts to AED 14.4 billion in Dubai in the previous year.
Due to the easier procedures for visas and property ownership, studies have shown the Indians as the largest ex-pat community in the UAE. This is also because the UAE and India’s culture matches to a particular level, and Bollywood has connected the two countries.
5. Regulated and Stable Environment for investment
There is a stable political environment for investment in Dubai with highly regulated property and construction sectors regulated by the Dubai Real Estate Regulatory Agency (RERA). Frameworks like escrow regulation, rental caps, and rental dispute settlement centres exist that keep property investments in the UAE safe for both developers and investors.
Countries like India face instability in the operation of business and investment due to various protests and opposition of various political parties. Dubai may be the safest option to have a stable environment to put their money on. Therefore, it remains a safe and very attractive choice to invest in properties in Dubai.
Buying now offers investors the opportunity to get a decent deal on the property, leading to even greater investment returns as the economy continues to recover and rental property demand rises.
6. Better Investment Plan
Investing in properties is better than leaving the excess cash in the bank. This has been proved in the survey that asked the residents of UAE about what they would like to do with the extra cash and around 37% of UAE residents preferred to invest in real estate as compared to 35% who chose to put the money in the savings account of the bank.
The coronavirus pandemic has put light upon the importance of emergency liquid funds. Though keeping the money in the bank would make it more liquid and accessible, the low interest and inflation will dissolve the value of savings. However, due to the active market of real estate in the UAE, the investment in real estate is also liquid to some extent.
With the low-interest rates provided by the bank and financial institutions which are affected by various other factors, investing in real estate would yield a better return according to the trends.
7. Expo 2020
Due to the pandemic, the dates of expo 2021 have been rescheduled for October 1st, 2021- March 31st, 2022. This is the globally recognized expo where over 25 million people from 180 countries are expected to participate in this expo. So this expo has a huge point of attraction and creates various opportunities for the investors for deriving the highest return on their investment. Millions of people will come with the intentions of renting or selling, buying or investing in the property, which will increase the demand and, hence, chances of profitability and return. So this expo can be the breakthrough for many Indians who desire to invest in the Dubai property.
Disclaimer: We strongly advise readers to look for professional services help in order to decide before making any investment plans.