Property in Dubai: Brits are third-biggest buyers
STATISTICS from the Dubai Land Department show there are around 19,000 Britons who have invested in property there so far. They spent around £1.6 billion during 2014 alone.
Britons are third on the list of top investors in the Dubai real estate market, beaten only by Indians and Pakistanis.
Such is the interest that a property show is being hosted in London this weekend for those keen to find out more.
According to Sunil Jaiswal, a British property investor who is organising the show at Olympia, the emirate’s tax-free status is one of the biggest attractions. There is zero taxation on rental income and capital gains.
In addition, foreign buyers have, since 2002, been allowed to buy property with freehold rights. Plans on the horizon – such as hosting the World Expo in 2020 – also make it an attractive destination for investors.
“We’re hoping to attract people to the show who are curious about Dubai and want to know more. They’ll be able to get an idea of what’s on offer and talk to developers,” he said.
Mr Jaiswal, 42, left Milton Keynes for Dubai nine years ago, having swapped a career as an IT consultant for a life as a property investor.
He said you can buy a studio or one-bedroom apartment in a decent, but not prime, location for £85-90,000 and in a prime site like Dubai Marina for double that. A four-bedroom family villa will set you back £800,000.
“I’ve seen a lot of British expatriates buying property here although after the economic crash in 2009 things slowed down dramatically. While a lot of people left the market, those who stayed got good returns on their properties and Dubai’s bounced back,” he said.
“It’s a tax-free jurisdiction and one of the few places in the world where you can buy freehold land. Anybody can buy property here in certain areas. Although there are certain parts of Dubai where foreigners are only allowed to rent, they can still buy in 90 per cent of the best areas. Once you’ve bought you get a title deed and it’s in your name forever. We see investors coming here and buying a property for the long term. You can get a 10 per cent rental yield.”
Mr Jaiswal explained: “The buying process is different to the UK. You don’t need a conveyancing solicitor like in the UK – the Dubai Land Department will do the checks. It takes about a month to complete the transaction and the fees are typically 7.5 per cent to 8 per cent of the property value.”
Financing is usually arranged through local banks, which will loan foreigners up to 50 per cent of the purchase price. A 25 per cent deposit is required.
It is not necessary to live in the UAE in order to purchase – and many British investors do not. However, the UAE government has a six-month visa called the property holders visa, which allows foreign investors to stay for up to six months. You cannot work on this visa – a different type is needed for those who want to live and work in the emirate. Mr Jaiswal recommends the lifestyle for those who do.
“Since 92 per cent of the population are expats, the mindset is very open and that is wonderful. People are open and receptive to new ideas,” he said.
Ryan Crowley, from Cork in Ireland, runs a security firm in Dubai. He bought a £330,000 home around 18 months ago. The two bedroom, 2,000 square foot villa is set within a gated community in DUBAILAND, which is envisioned as a regional and global tourism hub. The 3 billion square feet site hosts a number of sports, leisure, entertainment and shopping centres with more in the pipeline.
