The emirate is recognized as the investment center of the Middle East and the place with the safest investment environment in the entire region. Is it any wonder then that around 80% of Dubai's population is made up of foreign nationals? What’s more, Dubai is one of the leading countries in the world when it comes to holding the top spot for most attractive investment city.
Even the rating agencies, Moody’s and S&P have noted that the emirate’s investment attractiveness is quite stable and overall has a positive outlook.
In addition, factors such as an advantageous geographic location, a rapidly developing commerce and technology sector, and a variety of benefits and incentives when it comes to doing business, all attract the largest companies from the S & P500.
So simply based on Dubai’s location, a potential investor looking to invest their own capital already has access to a variety of real estate properties and developments. Each of which has different prices and different ways one can make money off of them.
In the following article, we’ll be looking at the most profitable areas of Dubai for 2021, their characteristics, as well as any upcoming opportunities and developments.
A list of areas for investment and their respective overviews
This year the following indicators correspond to the real estate market:
- Rental income is around 10%.
- Prices are quite low, in particular, for the premium class real estate division.
- Investors can benefit from the diversification of assets into different types of property, with different lease levels and locations available.
- The possibility to obtain the right to 100% ownership of a property under certain conditions.
- Low susceptibility of real estate to inflation.
- High liquidity of assets.
- Strengthening of government measures aimed at protecting investor capital.
- Investments in real estate serve as a significant confirmation with regards to the creditworthiness of an investor, especially if he/she wants to take out a loan from a bank in the emirate at a very favorable rate.
So choosing the right place and the right way to invest is one of the most important factors in getting the best return on your investment.
And, while we can see that the above-mentioned areas have inevitably dropped in performance during 2020, they nonetheless still hold a high level of attractiveness.
Downtown Dubai, formerly known as Downtown Burj Dubai is the actual center of the Emirate. It is located near Sheikh Zayed Road, next to the “Manhattan Dubai” Business Bay and the special economic zone, DIFC. On the eastern side, it is located next to the Meydan racetrack, while on the western side it is located close to the Jumeirah 1 district, a center for water sports.
The demand for real estate Downtown at any time is consistently high. Perhaps it’s because here, the local real estate market combines high-rise apartments with a considerable number of expensive villas all at similar prices as that of the more affordable properties.
In the upper section of apartments, 4-bedroom studios are very popular as they are extensively used., Although, as of late 5-bedroom apartments have also become popular.
Furthermore, expats tend to rent studios Downtown. Most often these are spaces ranging from 42 to 52 sq. m. The most popular is the Burj Al Nujoom apartment complex.
Here in this complex, the average price values fall within the following ranges:
- The rental rate for a studio and medium-sized apartment ranges from $ 14,500 to $ 21,000.
- This figure can be as high as $ 33,000 for medium and large spaces.
- The actual amount for the purchase of completed properties is approximately $ 2,047,400.
- Off-plan real estate prices start at $ 2,460,000.
Business Bay is one of the main districts which has become a kind of incentive for Dubai development, as it is a center full of business activity. The area is located in the center of Dubai nearby Downtown Dubai.
According to Bayut's 2020 Dubai Annual Sales Report, Business Bay has become one of the most popular destinations for businesses and investors who are looking to purchase or rent affordable apartments.
The area attracts a massive amount of young foreign professionals. So the lifestyle here is usually suitable for young couples and single people.
Apartments, hotels, and warehouse/sorting facilities for companies that are engaged in a rapidly growing internet business occupy a special place in the real estate sector in Dubai. Here, the community at large is a combination of eclectic real estate properties, some of which include residential, commercial, industrial, and resort. So one can be sure that the real estate on offer will be a good balance between unsurpassed quality and very affordable prices. According to the overall estimates, more than 240 commercial and residential buildings are located here.
What’s more, most of the attraction lies in luxury villas. For example, the Executive Towers pavilion and the Marasi floating villas, which are both located near the Dubai Canal sea route. In addition to this, there is also the Sky Villas.
The average price indicators for real estate in this area are as follows:
- On average, the price for the purchase of one square meter is $ 3,180.
- The average purchase price for a property is $ 2,768,000.
- The average rental rate per residential unit is just over $ 21,900 per annum.
- The largest apartments are available for rent from between $ 24,000 to $ 78,900 per annum, while the sale price ranges from $ 625,500.
Furthermore, the maximum apartment prices can reach up to $ 10,878,800, while the cost of penthouses can be $ 19,799,500 per annum.
Jebel Ali is also known as Mina Jebel Ali. It is an area with a large number of mixed-use projects with five main focus areas, namely, commercial, industrial, retail, entertainment, and residential.
This area is next to to the Dubai Investment Park, as well as the Al Maktoum International Airport and the Dubai Parks & Resorts complex.
The following developments are being built within the district:
- Jebel Ali Port.
- Palm Jebel Ali.
- Elite residential complex, Jebel Ali Village.
- Special industrial zone.
- Free economic zone, JAFZA.
Jebel Ali Port is the 9th largest port in the world and the 1st in the Middle East. Moreover, the JAFZA special economic zone alone brings in 23% of Dubai’s total GDP for the Emirate.
In addition, JAFZA is home to over 7,000 different companies that are involved in the trade, logistics, industrial production, and services sectors.
The most popular real estate groups in the area are:
- Jebel Ali Hills.
- Rove At The Park.
- Garden View Villas.
- Al Muntazah Complex.
- Jebel Ali Industrial Area.
Here in Jebel Ali, the main part of the villas and townhouses is occupied by residential buildings with three or four bedrooms. The apartments are outfitted with either one or two bedrooms or a studio.
Real estate prices in this area are as follows:
- The rental rate for a standard studio, with an area of approximately 46 square meters, ranges from $ 6,200 to $ 8,100.
- The cost of a one-room apartment is approximately $ 9,500, while a two-bedroom apartment of about 125 sq. m. costs around $ 10,600.
- Real estate is also sold for amounts of $ 170,000 - $ 200,000.
- The average price for studios and one or two-bedroom apartments can be around $ 326,700.
- The average real estate price per sq. m. is approximately $ 300.
Dubai Marina is located close to Sheikh Zayed Road, opposite Jumeirah Lake Towers and in between Dubai Media City and Jebel Ali Free Zone. More specifically, this district is located in the heart of the city.
Here, the demand and prices for renting, purchasing, and selling of real estate are seasonal in nature as it depends on how many foreigners visit the Marina.
Also, the average rental rate for a studio or apartment starts from $ 10,000 onward.
As for the prices of medium to large apartments, these can range from $ 22,700. This is slightly more expensive than the average cost in Business Bay.
Plus, rentals of the largest apartments can reach up to $ 93,600 in price. Additionally, villa rentals can range from $ 39,200 for the smallest ones to $ 113,500 for the largest ones.
The average price for the purchase of one sq. m. is $ 4,350, while real transaction prices are within the price range of $ 775,000.
Furthermore, the purchase price of the “Off-plan” property is currently at $ 409,000.
There are also a wide variety of properties available for purchase in Freehold.
So a favorable geographic location attracts a considerable number of people from business travelers who want to have quick access to their jobs, to high-income tourists in search of top-level residential real estate in prestigious and comfortable coastal areas.
Jumeirah Village Circle
Jumeirah Village Circle is a separate community of over 2,000 luxury villas and elite townhouses.
The Village Circle is just a short drive from the Expo 2020 pavilion and has easy access to the emirate's industrial and commercial center, Jebel Ali. Plus, it also provides convenient access to the city's highways and Al Maktoum International Airport.
Investors are quite interested in this area due to its competitive prices where real estate properties are concerned.
This area is currently focused on attracting foreign citizens with large families who are in search of permanent residence. Furthermore, the area also features two international schools, several medical organizations, as well as numerous clubs for active leisure, and a variety of entertainment venues all for the whole family.
Dubailand is one of the fastest growing residential areas in Dubai and houses communities such as Mudon, Dubai Lifestyle City, and The City of Arabia. And because Dubailand offers such a wide range of residential properties one is guaranteed to find a suitable property at the right price.
Also, one of the unique features of this area is that it boasts an impressive number of botanical gardens, academies, and various cultural attractions. In addition, this residential area is home to several well-known shopping centers such as Dubai Outlet, Global Village, Motor City, and sports facilities.
So, while Dubailand currently attracts many families and single expats, tourism in this area is still expected to continue growing steadily in the near future.
Barsha Heights is also formerly known as TECOM and presents investors with a choice of both residential and commercial real estate, as well as hotels.
What’s more, this area is home to an impressive number of Fortune 500 companies, including Microsoft, HP, BBC World, CNN, and Reuters. Clearly, Barsha Heights attracts a significant number of IT workers and representatives from both medium and large enterprises.
Expo 2020: introducing investment opportunities
The exhibition will run from 1 October 2021 to 31 March 2022, since was been postponed in 2020 due to the COVID-19 pandemic.
As a result of this prestigious event being hosted in the UAE, it is expected that the real estate market will be given a much-deserved boost. As such, the highest demand for both rental and purchase of apartments can be expected in the following areas:
- Dubai Investment Park is a commercial area with widely available residential real estate such as The Green Community Village and Green Community East which are both located nearby. Also, Dunes Village, a famous complex with expensive resort housing is located nearby to the north of the Park.
- Dubai Production City is a special economic zone and is known for providing an unusually wide range of properties, particularly, where purchasing “Freehold” property is concerned.
- Jumeirah Golf Estate is an extremely elite residential complex and differs from others of its kind in that it is geared towards golfers.
Furthermore, high demand for rental and purchase of villas is predicted in the following areas:
- Jumeirah Golf Estate, which has been mentioned above.
- Al Furjan, which is a gated community providing a wide range of high-quality luxury villas and townhouses for purchase at attractively low prices.
- Mudon, which is a residential complex located in the east of Dubai. It offers a huge selection of readymade villas and townhouses, as well as, ones that are still under construction. This makes for a rather convenient “off-plan” investment.
We will assist you to choose property in Dubai
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Plus, not only do we analyze all of the current changes and happenings in the real estate sector in Dubai, but we’re also able to provide you with up-to-date forecasts of the latest projections. Don’t delay and contact us today! You won’t be disappointed.