DUBAI REAL ESTATE INVESTMENT & POPULATION GROWTH
The Dubai 2040 Urban Master Plan has set the fundamental frameworks for driving investment and shaping the future growth and development of Dubai. The Urban Master Plan aims to attract new residents to Dubai and anticipates a 76% surge in the city’s population over the next 20 years. The government’s primary goal for the year 2040 is to achieve a population of 5.4 million, but given the current pace of population growth, this target may be reached as early as 2035.
To support the projected population growth, an additional 550,000 properties are required. However, based on the current rate of production, there will be a shortage of 25% in housing supply if the population reaches the target of 5.4 million by 2035 or exceeds it in 2040. Presently, 70% of Dubai’s primary city centre is either developed or nearing completion, and this number is expected to rise to 90% within the next five years. As a result, there will be a natural increase in land and property values due to the increasing demand for real estate in these areas. As part of Vision 2040, five urban centres will be established to promote economic activity across Dubai. Three of these centres (Deira/Bur Dubai, Downtown/Business Bay, and Dubai Marina/JBR) are already established, while the remaining two (Expo 2020 and Dubai Silicon Oasis) are currently under development.
With its young, modern, and adaptable infrastructure, Dubai is a well-developed city that offers excellent tax benefits. Moreover, Dubai’s strategic location and welcoming environment have made it a global hub, with over 190 nationalities currently residing in the city. As of January 2023, the population of Dubai stands at 3,552,346. The city has a relatively high population density, with an estimated average of around 762.6 individuals residing within each square meter of land. Dubai ranks as the second largest, in terms of land, among the Emirates. Spanning approximately 4,114 square kilometers, Dubai encompasses a considerable expanse of land. Dubai has close to 16,000 properties on air BNB, hotel apartments 26,000 and hotel rooms 115,111, with an average occupancy rate of 94%.
REAL ESTATE SALES TRANSACTIONS & VALUE
The last two years of strong sales have increased property prices 30- 50% and rental returns (ROI) between 6-10%. The Dubai real estate market is still undervalued compared to comparable cities and still provides a higher quality of life. This demonstrates the market is still young with a lot of potential to grow. As illustrated by UBS report, Milan, Sao Paulo, Dubai and Warsaw are risk free investment cities.
At Audley’s International, we guide our clients with a bespoke end-to-end service that provides them with the support and guidance to maximize their returns on their investments. Whether it be short-term or long-term, our team has the expertise and knowledge to guide you through this process. Our strategy is tailor-made according to your needs, be it a personal purchase, a property investment looking at rental returns, or short-term gains from off-plan property purchases with payment plans.
- Tax-free on residential properties capital gains and Rental Returns.
- Dubai Currency is pegged to the US Dollar and the market does not suffer from currency devaluations.
- Dubai is ranked in the top 5 for safety and lifestyle on most charts.
- Dubai offers Golden Visas for 2 years at a $205,000 investment and 10 years at a $550,000 investment.
- Dubai is centrally located globally, with the world’s number one airline Emirates, providing direct flights to the majority of the world’s cities.
In H1 2022, there were 261,958 business registration and licensing transactions in the UAE, showing a 33% increase from the previous year. The country also saw a significant influx of high net-worth individuals investing in 2022. Making it the number one top country that saw investments from high net-worth in 2022 Additionally, tourism in Dubai reached 14.36 million visitors and is projected to continue growing.
DUBAI’S GDP & ECONOMY
Dubai’s economy showcased remarkable growth in the first nine months of 2022, with its Gross Domestic Product (GDP) expanding by 4.6% compared to the previous year, reaching a total of AED 307.5 billion. This exceptional achievement can be attributed to the collaborative endeavors of numerous entities that have been working towards positioning Dubai as a global leader in various sectors. The government reported that the city’s GDP witnessed substantial growth, reflecting the continuous upward trajectory of its economic performance. In January Dubai announced an aggressive plan to double the size of the economy by the year 2033, with targets totalling 32 trillion dirhams. This will consolidate Dubai’s position among the top three global cities, which further demonstrates it’s currently undervalued real estate. The new economic agenda would increase foreign trade by 44% to 25.6 trillion dirhams within the coming decade. Dubai anticipates an increase in foreign direct investment to exceed 650 billion dirhams within the decade.