Amid slump, Dubai realtors to woo Indian buyers
The Dubai Land Department says Indians are the largest investors in the Emirates property market after the Arabs.business Updated: Dec 01, 2016 11:21 IST
Come December Dubai’s leading property developers will fly to Mumbai to woo Indian investors. For the last 2-3 years, wealthy investors have been buying properties overseas as the residential property market has slumped.
The Dubai Land Department says Indians are the largest investors in the Emirates property market after the Arabs. In the first half of this year, Indians struck 3,656 deals, spending nearly $2 billion on properties in Dubai. The deals made so far in the market are worth $15.5 billion.
Indian investment in Dubai real estate has surged from just about $0.5 billion in 2011 to $5.45 billion in 2015.
“Dubai is a popular destination among investors. You can invest in tax-free property and get good returns ... we are getting a lot of inquiries from India,” said PNC Menon, chairman of Sobha Group that is developing a mixed-use project (both commercial and residential) called Sobha Hartland along the Dubai Water Canal on 8-million square feet.
Menon also expects more Indian investment in Dubai real estate after the demonetisation.
“Demonetisation may impact the market … the next opportunity for HNIs (high net worth individuals) is outside India. UAE has always been an attractive market,” said Hemal Mehta, partner at Deloitte.
In recent years, Dubai has become an attractive market for second home buyers, given its given its proximity to India.
“The reasons are simple. In Mumbai, $1 million will buy you a mere 96 square metres , in Dubai, 145 square metres,” said Anuj Puri, chairman of realty consultant JLL India.
According to UAE real estate portal Bayut.com, Indians looking for Dubai properties accounted for over 65% of total search hits on its website last year. Jumeirah Lakes Towers, Dubai Marina, Downtown Dubai, Business Bay and Dubai Sports City are among the preferred destinations for Indian investors, Bayut said.
Rental returns in Dubai are also higher at around 7-12%, compared with other overseas destinations like London and Singapore, where yields are around 3.5% and 2.8% respectively. There is also an expected annual capital appreciation of around 20-30%.
A two-bedroom apartment in upmarket Dubai costs about Rs 3 crore, far cheaper that what you would get in Mumbai where the price would push you to a smaller locality.