The real estate business is as old as time itself, with prizes of properties around the globe skyrocketing by the minute. Even now, the real estate market seems to be experiencing an all-time high. This continuous appreciation of land and its subsidiaries has made the real estate sector an excellent investment option for seasoned investors and newbies.
A random study of the real estate market trend especially reveals some regions of the world with more potential for remitting higher ROIs. One of these top lucrative investment options is the realty market in Dubai. Owing to its limitless potential, the market is fast becoming a hotspot for tourists, business owners, political allies, and scholars hoping for a slice of the cake.
Ultimately, this influx of people from all spheres of life translates to greater demand for landed properties. Who better to serve that demand than the growing real estate market, made more desirable by the city’s architectural attractions, mind-blowing infrastructure, a serene political environment, and an ever-growing economy.
A most affordable way of reaping these benefits without breaking the bank and still getting the highest possible return on investment is by investing in off-plan properties in Dubai. This article will explore five reasons realty investment experts deem this option the most profitable means of milking the real estate market.
An off-plan property is essentially a property still in its developmental or pre-developmental phase. This broad term encompasses newly-announced properties or those partially-completed or undergoing construction. In such scenarios, pre-constructions are usually marketed to real estate developers and investors to gain their interest and have them commit financially even before constructing a structure on the property.
That way, developers could sell off these properties by marketing the plan on paper to potential investors. Let’s look at why investing in off-plan properties in Dubai is the best investment decision to join the league of elites.
Land-related investments are almost risk-free, and investing in off-plan properties in Dubai is no exception. Hence, it is a no-brainer that getting one at the pre-construction phase at a significantly lower price would guarantee great returns in the long run.
Off-plan projects are the safest bet for investors looking for properties with lower prices. As these properties are non-existent per se, it falls on developers to invent strategies that would pull in more investors. One such means is by offering flexible payment options. For instance, developers could lure potential investors by making available the option of paying in installments over a specified period.
Lower prices and flexible payment options are key players in attracting investors in any form of business, as it fosters trust, proffers affordable payment plans and depict practicability.
Like many other investment deals, purchasing off-plan properties in Dubai does not come without its risks, from cancellations to frauds. Ultimately, investors stand a chance of losing their money or at the very least, falling short of their expected ROI. However, several buyer protection laws in Dubai strictly mitigate against these undesirable and mostly unforeseen situations.
The Dubai Land Department (DLD) and the Real Estate Regulation Authority (RERA) have several measures in place to ensure potential investors have added protections against such menace. For instance, a rule governing off-plan purchases mandates buyers to make payments only at DLD-approved banks. The banks in turn would bar developers from accessing the funds until the project reaches a stipulated completion point.
Such laws boost the confidence of investors, making them more at ease, with no fear of getting scammed or overly delayed.
Popularity and urbanization are major factors the real estate market banks on. This is so because properties in highly sought-after regions or neighborhoods tend to appreciate faster than others. Hence, most on-plan properties in such localities sell off fast, at higher prices, once put on the market. However, in the case of off-plan properties, despite knowing the realty sector would appreciate, it’s tough to predict the return.
By implication, the market value of a property could rise dramatically in the long run, even before the completion of the project. Being some sort of early bird, these investors would purchase at prices much lower than actual on-plan properties. Upon completion, the properties would sell at a higher value, which tends to appreciate as the years go by, guaranteeing greater ROI.
The tax-free policy is perhaps the most enticing reason for investing in Dubai, be it on off-plan projects or other investment options. Dubai laws have no mandatory income or capital gains tax imposed on investors. This makes the city the best place to invest and maximize returns. Interestingly, Dubai is one of only a few international cities with tax-free status, making it a top pick for seasoned realty investors and potential investors.
In recent years, the federal government in the United Arab Emirates has executed numerous plans to reduce the country’s dependency on oil as a source of revenue. This move would guarantee stability within the nation and its various emirates. To accomplish this great dream, the government has encouraged growth in other sectors like hospitality, tourism, construction, real estate, arts and culture.
These sectors flourish in known tourist destinations in the UAE, with Dubai topping this list. This economic boost has given the city an edge, and surefire insurance for political stability and continued economic growth. Coincidentally, these two factors are important keys to determining localities that are good investment choices in the realty sector.
Why not make that big leap today and be among the early birds to own a piece of the pie in a flourishing economy with a growing real estate market?
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Author: Nick Hyland