High levels of tourism, high rental yields, no tax and a glamourous landscape of skyscrapers and islands in the shape of a palm – Dubai is a prime destination for investors looking for property. This guide provides all the information you need for investing in property in Dubai.

Can I buy property anywhere in Dubai?

No. Overseas investors are only allowed to purchase freehold properties within designated areas in Dubai as follows:

• Umm Hurair 2
• Al Barsha South 2 & 3
• Emirates Hills 1, 2, 3
• Jebel Ali
• Al Jaddaf
• The World Islands
• Ras al Khor
• Sheikh Zayed Road
• Sofouh 1 & 2
• Al-Qouz 3 & Industrial Areas 2 & 3
• Mirdif
• Dubai Marina
• Palm Jebel Ali
• Palm Jumeirah
• Nad al-Sheba
• Warsan 1

What are the benefits of buying property in Dubai?

• Rental yields for apartments in Dubai range between 5% and 8% on average.
• Villas generally yield around 4% to 6%.

Yields will vary based on location, property type, and market conditions, however these are up-to-date estimates from the following sources: (Star Sterling Property) (HiDubai Focus).

As an example, Dubai Marina has an annual yield of between 4.72% and 6.31%, an annual rental range of from £17,856 to £81,696. However for a property purchased at £283,155 (average price), the yield would be approximately £13,347 to £17,864 annually.

How can I maximise rental yield as an investor?

Enhancing a property’s appeal through high-quality furnishings and attractive interior design can attract higher-paying tenants and increase rental income. Premiums can be charged on properties with advanced technology and smart home features such as smart security systems, energy-efficient appliances and automated home systems.
Offering long-term leases provides stability and ensures consistent rental income reducing the risk of no occupancy.
Regular upgrades and proper maintenance preserve property value and attract tenants willing to pay premium rents.
A further boon of the Dubai property market is its lack of income or inheritance tax – though foreign investors may be subject to both taxes in their home countries and appropriate planning should be undertaken with a professional advisor.

Who would look after my property if I’m not in Dubai?

There are plenty of professional property management companies in Dubai who would be responsible for:

Maintenance and Repairs: Regular upkeep to maintain property value.
Tenant Management: Handling tenant queries, complaints, and lease agreements.
Rent Collection: Ensuring timely rent collection and handling late payments.
Marketing and Leasing: Promoting the property and finding suitable tenants.
Financial Reporting: Providing detailed financial reports to track income and expenses.
When choosing a property management company, look for companies with a good reputation and strong track record of experience. Ensure they offer comprehensive services, including maintenance, tenant management, and financial reporting and compare fees and contract terms to find the best fit for you.

What are the funding options for purchasing property in Dubai?

Fixed-Rate Mortgage: Interest rate remains constant for a specified period, providing stability and predictability.
Variable-Rate Mortgage: Interest rate fluctuates with the market, based on the Emirates Interbank Offered Rate (EIBOR).
Discounted Variable Rate Mortgage: Offers an interest rate set below the lender’s standard variable rate for a predetermined period.
Offset Mortgage: Links to your savings account, offsetting your savings balance against your mortgage balance to reduce interest payments.
Interest-Only Mortgage: Monthly payments cover only the interest, with the full loan amount repaid at the end of the term.

How do I find the right investment property in Dubai?

Investors can find properties through several online platforms such as Rightmove, Zoopla, Property Finder or use an agent like Hardington Residential.

At Hardington Residential., we assist investors by finding the best properties, guiding them through the process, assessing rental yields, and analysing market demand.

What would example investment strategies be?

• Long-term rentals provide stable and consistent income with less property management needed.
• Short-term rental properties have higher rental yields, especially in tourist areas, but require more active property management.
• Buying undervalued properties, renovating them then either refinancing and renting them out or selling them for a profit.
• Understand market trends to buy low and sell high.
• Diversification of your portfolio by investing in different types of properties such as residential, commercial or mixed-use.
• Invest in multiple locations to spread risk and take advantage of different market dynamics.

What are the risks and things to watch out for?

• Scams and fake listings – ensure agents and property developer entities are registered with the RERA (Real Estate Regulatory Authority), both for completed and off-plan projects.
• Research neighbourhood prices before signing any contracts, making any agreements or putting any funds in to avoid overpaying
• Check for critical documents like the MOU (Memorandum of Understanding) and NOC (No Objection Certificate and make sure they are signed by your agent.
• Crunch rental yield data to pick ideal areas. Do your own research, and never believe what a seller is trying to tell you without checking for yourself.
• Verify the seller has legal rights to sell the property.

At Hardington Residential, we provide essential services such as:

• ­ Property purchase price analysis
• ­ Rental rate benchmarks
• ­ Yield forecasts
• ­ Paperwork review
• ­ Buying decision support

Overall, Dubai offers an attractive investment landscape with lucrative rental income, and a strong tourism industry with a continuous drive for property development due to rental demand and price growth. Dubai currently ranks 5th globally for price growth with prime areas seeing over 7% increases, and experts are predicting a 20% growth in rental rates in Dubai in 2024. It is also worth noting that property investors in Dubai, where the investor owns over £2 million AED of property (approx. £420,000) will also have access to a 10 year Golden Visa in Dubai.

Contact Hardington Residential for tailored assistance and start your property investment journey in Dubai today.