• Thursday, July 25, 2024


Why Dubai’s next growth cycle could be massive for global investors

Besides the UK, Australia, Turkey, Iran and other parts of Europe and North America, industry insiders also expect investors from markets such as India, Pakistan, and various Middle Eastern nations to play key roles in fueling the desert city’s real-estate market.

Boats are anchored in the Dubai Creek surrounded by high-rise buildings in the Gulf emirate, on February 18, 2023. (Photo by KARIM SAHIB/AFP via Getty Images)

By: Shubham Ghosh

INVESTORS from countries such as the UK, Australia, Turkey, Iran and other parts of Europe and North America are poised to drive the next phase of growth in Dubai’s property market. They are drawn by the prospect of higher returns compared to major markets, increasing taxes in those markets, and overall challenging conditions, besides a tax-free environment, the Khaleej Times reported.

Industry insiders also expect investors from other traditional markets such as India, Pakistan, and various Middle Eastern countries to play significant roles in fueling Dubai’s promising real-estate market during its next or fourth growth cycle.

According to the Khaleej Times report, while the emirate’s real-estate market has gone through three phases — the pre-global financial crisis of 2009, 2014 and post-COVID, many experts feel that the third cycle is now approaching its conclusion after peaking in 2023-24. It, however, added that the fourth cycle is likely to be a period of minor amends rather than a boom-and-bust scenario, paving the way for the next cycle of growth.

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Guillaume Giroux, CEO of Dubai-based Elysee Vendome Real Estate said the desert city is nearing the end of its third property cycle, with a new one set to commence soon.

According to him, the upcoming cycle could attract buyers from various countries.

Read: World needs inclusive governments: Modi at Dubai global summit

“French investors are still interested in Dubai’s properties, especially with uncertainties in Europe pushing them to look elsewhere. It’s predicted that many European nationalities will influence Dubai’s property market in the future,” he was quoted as saying by the Times.

Giroux added that high taxes and lower returns in their own countries are propelling them to find better opportunities elsewhere.

“Challenges like strict regulations in France are also pushing investors towards markets with higher returns and stable rules.”

According to Mouna Muller, client manager at Betterhomes, with Dubai’s third property cycle nearing its conclusion, the fourth cycle is expected to be driven by a diverse array of investors.

She added that the anticipation of increased taxes in the UK, Australia, and Europe is likely to motivate investors from those regions to explore Dubai, attracted by its tax-free environment and favourable investment conditions.

Muller also said that investors from countries such as India, China, Iran, Turkey, and others will also play key roles, influenced by various economic and geopolitical factors.

Ramjee Iyer, chairman and managing director of Dubai’s Acube Developments, feels investors from countries that have comparatively high taxes such as the UK, Australia, and most of Europe, understandably seek tax-efficient investment opportunities in other countries, and Dubai’s tax-free environment prove to be very appealing for them, the news outlet reported.

While industry sources indicate that Chinese investors will replace their Russian counterparts and will be a major player in the local property market, Iyer said recent data have revealed that British investors have put behind Indians this year as they rush to the Gulf nation for Golden Visas, tax-free benefits, high rental yields, and the emirate’s renowned luxury lifestyle.

“The Chinese will also be a major Dubai market force due to the two nations’ robust economic connections and strengthened political ties. Other nationalities worth keeping an eye on include Turkey and Iran. Turkish buyers appreciate Dubai’s strong economy and innovative projects, while Iranian buyers find Dubai’s peaceful atmosphere, career opportunities, and economic stability highly appealing,” Iyer was quoted as saying by the outlet.

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