Dubai
Dubai Real Estate Investments
Dubai is a property market known the world over.
Some of the most famous buildings and developments in the world can be found in the emirate – and investors also find some of the biggest return on investment too.
- A 110% rise in transaction value
- 6-8% yields available
- 10% recent capital appreciation
- 0% tax – potentially investors an enjoy the full return of their investment
Dubai real estate investment highlights
We’ve helped 100s of investors acquire £100s of millions worth of Dubai real estate.
We are extensively familiar with the market and top-tier developers operating within the emirate.
Here, we provide a brief overview of the Dubai real estate market, including:
Past performance of Dubai real estate
Future forecasts for Dubai property investments
Assets and Dubai investment locations
Essential investment information
History of Dubai real estate
Over the past 20 years, the topic of Dubai property prices has generated a lot of news coverage.
Like every market, investors have experienced periods of significant growth and returns as well as a few downturns. However, Dubai’s standing as the most exciting prime real estate market in the world has remained constant.
As a result, despite having some of the highest per-square-foot prices in the world, Dubai real estate continues to draw hundreds of new investors each year who are all hoping to obtain profits that are unmatched by other markets.
300% growth and a £1 trillion stall
Fewer investment periods in the history of real estate have produced such a high return as what is now known as the Gold Rush. Early investors in Dubai who acted decisively between 2002 and 2008 witnessed a 300% surge in real estate values as the emirate simultaneously emerged as one of the world’s fastest-growing cities and real estate markets.
Following the introduction of the game-changing foreign ownership decree, ROI was as high and as fast as the newly constructed skyscrapers of Dubai Marina.
Even towards the end of this period, Dubai stood above every other prime property market in the world offering average annual capital appreciation of 30+%.
Investment was everywhere and it birthed the era of the mega-project. Developments on such a huge scale that few countries on Earth have attempted one of them, let alone 5 in the space of a few years. Jumeirah Garden City, Dubailand, The Lagoons, Palm Jumeirah, and The World represented over $200 billion of state and private investment.
And then Dubai experience what every other prime property market in the world has experienced: its first dip. And it was a big one.
AED 1.1 trillion worth of property projects that were in the works at the time were stalled or abandoned as the global banking crisis of 2008 took its toll.
Over the next 4 years we saw investment continue in Dubai property, but not at the scale we were used to. 2012 marked the beginning of the second golden period and the revival of mass construction work. Dubai’s property prices rose by another 40% over the course of the following two years.
Since then, the market has shown signs of maturity, none more so than in the last year.
Investment performance of the Dubai real estate market
In a post-Covid, global-economic-crisis world, Dubai now has one of the strongest economies and continues to offer investors a compelling opportunity to earn some of the world’s best real estate returns.
Last year, we saw the Dubai property market deliver performance that had not been topped in over 12 years – the final days of the gold rush.
Even compared to those halcyon investment delays, 2021 represented noteworthy growth and returns.
Latest full-year performance – Dubai property statistics:
- $41.1 billion worth of sales
- A 110% rise in transaction value
- A 75% rise in transaction volume
Over the previous 12 months, the average capital growth for residential property in Dubai is:
- 10% for apartment units
- 20% for villas
Current performance and outlook
Dubai recorded 20,000 property transactions in the first quarter of 2022. It is the highest volume ever recorded for the January through March period.
Some investors at the very top end of the luxury market have seen their assets increase in value by nearly 60% in the last year. Although those figures are not representative of the whole market it shows what is possible in Dubai and strong returns can be found across the board.
Furthermore, most forecasts predict further growth in the coming years with plenty of analysts optimistic about positive long-term growth in a more robust market. Investor sentiment highlights Dubai now enjoys a more robust and diverse wider economy and growth is more sustainable than at any point in the emirate’s history.
If you’re new to the Dubai real estate market you should take some time to familiarise yourself with the market authorities and regulators.
- The Dubai Land Department (DLD)
- The Real Estate Registration Agency (RERA)
Prime Dubai real estate investment markets
Dubai is home to 3.5 million residents – a population that is still growing at a rapid pace. As you’d expect from a market so large there are various submarkets that offer investors differing investment budgets and prospects.
Dubai Marina
- Recent increase in demand
- 13% capital appreciation in 2021
The marina is one of the most mature sub-markets in Dubai, and it is popular with both new and existing investors. Currently, you’d expect to pay around 2,300 AED per sq ft for a Dubai Marina apartment and AED 1,500 per sq ft if you want to acquire a villa there.
The average return across the market was around 13% with the limited number of villa units performing slightly better.
This year, there have been over 3,000 apartment sales in the marina, representing a 35% increase in demand.
Business Bay
- 3,500 acquisitions in 2021
- 6% capital appreciation in 2021
Business Bay is found on the banks of the $3.7 billion Dubai Water Canal and has become more popular than its close neighbour Downtown Dubai in recent years. It’s a prime location that offers luxury real estate, but at slightly lower entry points than Downtown.
This makes it particularly favoured among first-time investors wanting to buy property in Dubai. There is a current note of caution around Business Bay, however, as it becomes a bit of a victim of its own success. A high volume of apartments has entered the sub-market in the past 18 months and now the off-plan market has suffered a slight dip as a result of this small oversupply.
Downtown Dubai
- 170 rise in transaction volumes
- 10% capital appreciation in 2021
Over the past 12 months, there has been a significant surge in demand for real estate in Downtown Dubai, with transaction volumes rising by almost 170%. Growth has followed suit, with investors seeing an average capital increase of over 10%.
Numerous apartments are available here, and there is a good balance between completed and off-plan alternatives. There is also a small but strong villa market.
Downtown Dubai has been and continues to be one of the emirate’s real estate hotspots. It is home to the Burj Khalifa, the tallest structure in the world, and Dubai Mall, one of the largest (and unquestionably the most luxurious) shopping centres.
Palm Jumeriah
- 1,000 transactions in 2021
- 45% capital appreciation in 2021
The iconic Palm has always been a strong real estate submarket in Dubai, but the past 12 months have produced some exceptional levels of performance.
Spurred on by high-net-worth individuals from all over the world relocating to Dubai post-pandemic market, average capital values increased by 45% in the past 12 months across more than 1,000 transactions.
This actually means now may not be the most opportune time to invest in property on the Palm and investors might want to wait for a small correction. New investors are facing asking prices of a median sq ft price of AED 2,100 now.
Find Dubai properties
The Property Selection brings together an exclusively handpicked selection of some of the best real estate investments in Dubai and around the world.