JC: And how about the temperature in Dubai?
MP-L: It’s the perfect place for people to leave Europe in the colder season.
The unpleasant autumn-winter period is just starting, and it’s very pleasant there from October to April, actually still until mid-May.
We have such a Polish summer, temperatures from 24 to a maximum of 26 degrees, cool evenings, cool mornings, but a warm sea.
JC: So you can imagine that in an ideal scenario we go there for six months for our winter, and rent the rest. And what kind of return can an investor expect from renting a property in Dubai?
MP-L: Dubai is a very large city. As such, every neighbourhood has its pros and cons, and also the purchase prices are different, and therefore the return on such an investment is also different. I think at the moment it is between five and a half per cent and eighteen per cent. These eighteen are, of course, if we are talking about short-term rentals – yes, they are definitely more profitable.
JC: Monika tell us a bit about the country, what it’s like to live there, what it’s like to be there every day
MP-L: It’s such a place in the world that can’t be compared to anything else at all. One of a kind. And I have travelled the world many times and been to many places. It’s such a mix of Arab tradition and modernity. A mix of cultures, a place where nothing is impossible. Within a year or two, estates are being built, whole developments. People are simply making their dreams come true. An ideal place for architects and those looking for modern solutions, but also for those who want to feel the Arab culture there.
JC: All right, and tell me something about lifestyle in Dubai, what do you do there after work?
MP-L: In Dubai, people who live day-to-day like me go to work, send their kids to school and life goes on with its normal cycle, like in many other homes around the world. On the other hand, by having this weather – when the sun is shining, everyone feels the urge to spend time being active.
As such, Dubai is famous for its golf courses. There are plenty of them and they are practically at every turn. Of course, for water sports enthusiasts, there is the sea. Every estate, every residential building is equipped with a great gym, swimming pool, places for so-called meetings with friends, barbecues. All this encourages people to spend time outdoors.
JC: I understand there is a large group of expats. How does the local community react?
MP-L: It’s very interesting because it’s a place where, out of the total population, 30 per cent are just locals. And the rest are us expats who have come, usually for a year or two and stayed that long.
JC: But there is no conflict?
MP-L: No, no, there is absolutely no conflict. It’s a very open place. Dubai is the only place in the country that I could say is so open to different cultures, to foreigners and understands the needs of people who come from abroad and want to go out, have a drink, alcohol. You don’t have that in Sharjah, for example, or in other Emirates like that.
JC: Tell me more maybe, because I’m curious about the costs of buying a property, maintaining it, taxes. Is it very different from those Polish conditions?
MP-L: Well yes, Dubai is an ideal place because there are no taxes and I know that certainly compared to other places where Poles are looking around to buy at the moment, here… we are winning at the moment – there are no taxes.
JC: But what are the costs involved in buying a property, it looks different depending on whether you buy from a developer.
MP-L: If you buy directly from the developer, these costs are usually not there, that is, there are no agency costs. On the other hand, there are different shares and if they release a new product, there are very often fees (4%) for the transfer of the title deed. So we can compare it to the entry in our land and mortgage registers, i.e. 4% from the purchase, and if we buy on the secondary market, 4% is always + about PLN 4 500 for the entry in these so-called land and mortgage registers. On the other hand, sometimes developers take this fee on themselves.
JC: But what do you mean there is no tax? So when I rent out a property, I don’t pay tax on that rental?
MP-L: No, no, you don’t pay tax. You only pay the agency depending on what contract you have signed. If you have a contract signed for a long-term lease, these fees are about 8% per year + VAT, VAT with 5%. Not 22%, as in Poland.
However, if we are talking about rentals, it is known that the costs are completely different, because there is more work, which comes under such a hotel service – at the moment the fee is 18%. This is not much, because many companies charge 30% for managing short-term rentals – 18% is still an attractive rate.
JC: Then tell me Monica, what is it like? Are Poles buying in Dubai? Do you have a lot of interest from Polish customers?
MP-L: Yes. I have a lot of customers from Poland. There are more and more of them. I have some who have already bought even 18 and 20 years ago a property from me and they are my clients until now. But now there is a new wave, which I think is definitely linked to the situation in Poland, with inflation and people’s willingness to invest abroad, especially for those who have learned to work remotely.
If they are people who can run their businesses in any part of the world, they choose Dubai. It turns out it’s not that far away at all because we have direct flights. At the moment there are two airlines flying from Warsaw – that’s Emirates and Fly Dubai, which also operates from Krakow.
JC: The flight – six hours? How long is the flight?
MP-L: Five and a half hours direct.
JC: To Portugal four, it’s actually no difference.
MP-L: Very pleasant. The flights are both morning and afternoon, practically every day. It seems to me that in this respect the UAE has come very close to Poland.
JC: At what price? I think they also fly charters?
MP-L: Enter Air used to fly periodically and then you could buy a ticket for around 1,500 zloty. Emirates I think is at: 2-2500 / 2200 zloty.
With enough advance notice, if you buy tickets of course these prices are changed. Wizzair also flies to Abu Dhabi and you can get to Abu Dhabi with such a connecting flight. There are actually quite a few of these flights.
JC: And why do Poles buy? Because I know there is one answer that we haven’t touched on yet at the moment.
MP-L: You can apply for a three-year resident visa when you buy a property, which means investing a minimum of 750,000 in cash. At the moment, the Emirati government has put forward such a programme, that is 750,000 – that is a three-year visa.
JC: So you can invest €750,000 in a property….
MP-L: I am already speaking in dirhamah. 750 thousand dirhams is about 800,000, maybe 850,000 zloty. Then you can apply for a resident visa. If one member of a family buys, let’s say, the whole family gets the visa. So if a husband buys, the wife and children – the immediate family – can get the visa.
JC: What does this resident visa give you?
MP-L: There is a time limit on coming to Dubai. So normally, when you arrive in Dubai, you get a visa for 90 days. If you want to stay longer, you need a special visa, a permit to enter and leave. On the other hand, with a resident visa, you can of course stay as long as you like. You can enrol your children in school, get a driving licence, drive a car.
JC: Can you change your tax residency?
MP-L: Probably yes. And you can also open a bank account.
JC: So Poles are buying for that visa too.
MP-L: Bardzo dużo ludzi kupuje po to, żeby właśnie to było miejsce do tego, żeby spędzać te pół roku z dala od depresyjnej pogody europejskiej. Wybierają się tam i mogą otworzyć konto w banku, mogą kupić samochód. Jest to wiza tzw. inwestorska.
JC: And can you talk about any such most spectacular transaction with a Polish, or indeed non-Polish, client that you have done?
MP-L: The one I enjoyed the most was a recent property transaction. It happened to be Polish people I had never met before. People who had hardly ever been to Dubai, bought a property through trust, and chose the property online. Hardly, it was an off plan property, meaning not yet ready. I went to the sales office, had a conversation with the developer, which I translated into Polish. We showed a mock-up of the project, where the flat would be located. We showed, of course, what the flat would look like, the plan, and they made up their minds based on that.
JC: Amazing. But how is that possible? Without flying in, it is possible to do such a transaction?
MP-L: Yes. And that’s also an interesting point. If you’re buying from a developer directly, an investment that there’s a plan for (because at the moment it was all ready) – you’re buying something that will be ready in two or three years. On the other hand, it is very, very secure and there is absolutely no fear that this investment will not get built, or that you are pouring money in and you don’t know what happens to it. Again, my great appreciation to the Dubai government who regulate these things and there is absolutely no possibility that an investment that is on sale will not get built. Every developer who does something like this has to have a separate escrow account where the money is deposited and that money is taken from the people who buy, depending on the stage of construction.
JC: Monica It’s really fascinating what you’re saying about buying, over the phone actually, isn’t it?
MP-L: Yes, yes, ladies and gentlemen. I hope this conversation has given you an insight into the Dubai property market.
JC: Thank you very much Monica for the meeting. And well, there is nothing left for you to do but pick up the phone and buy a property in Dubai. So we will perhaps say goodbye to the audience in Arabic.
MP-L: Shukran, Shukran. Ma salama and Ma salama.
