Your real estate agent in Dubai
Monika Pawłowska-Lukasz
Dubaj
Dubai is the connecting country between Asia and Europe. There are direct flights from Warsaw and Krakow to Dubai twice a day, and in as little as 5.5 hours, either Emirates or FlyDubai will get you there. And there you will find sunshine and weather guaranteed for 360 days a year.
There is no property ownership tax in the UAE and VAT is only 5%. Rates of return, depending on the neighbourhood and area, range from 5% to 8% on an annual rental basis, while this can be doubled and tripled for short-term rentals. Dubai is cosmopolitan – only 30% are local Emiratis, the rest are expats. Consequently, there is no problem with schools here; you can easily find American, IB, international, British, German, French, Australian or Swiss schools. All with English teaching.Property prices vary greatly from neighbourhood to neighbourhood. A 70 m² one-bedroom flat in a pleasant neighbourhood and conveniently located can be purchased for as little as AED 1.2 mil, or just over EUR 300,000.
Dubai Real Estate
Why invest in a property in Dubai?
For many of the developments underway, the emirate of Dubai allows foreigners to acquire real estate ownership. For this reason, more and more people from all over the world are opting for this type of purchase. The advantages of such a solution are numerous. The first is, above all, the great security of the local economic market. The relevant regulations provide the stability that is so important when investing in real estate. Secondly, Dubai is also a safe city for residents. As many as 89 per cent are expats there, and holidays and customs of other cultures are respected and honoured there. This is the reason why many foreigners wish to live there. A stable dirham currency also provides great security for the country’s residents. One dirham is equivalent to one zloty, and a 70 m² property in Dubai can be purchased for as little as AED 1.2 million.
Short and long-term rentals in Dubai
Continued economic growth means that professionals are in great demand in the country. This is why many people are choosing to relocate to the United Arab Emirates and, consequently, are looking for an attractive place to live there. Owning a property is a great way to secure a passive income from renting. However, much more profitable than long-term rentals is short-term rentals. Dubai is currently one of the most popular travel destinations in the world, chosen both by tourists and for business purposes. As a result, flats for rent are still in high demand there. Visitors from all over the world can enjoy Dubai’s many attractions, such as the world’s tallest building Burj Khalifa, the famous Dubai Fountains, the Dubai Desert, the world’s largest entertainment and shopping mall Dubai Mall and the historic Al Fahidi district.
Find out more about why you should invest and buy property in Dubai.
Dubai Real Estate
Interview with a local estate agent
There are numerous benefits to buying property in Dubai.
We check which ones
Looking at the pace of development in this country and its capital, it is not difficult to get the impression that anything is possible here. Dubai is a one-of-a-kind place, with a unique cosmopolitan environment, a mix of Arab tradition and modernity and attractive regulations not found anywhere else. It is also a growing tourist and investment destination. What benefits await you as a property investor in Dubai? We check!
Dubai, or how to achieve the impossible in a few decades
Let’s start with a handful of facts. Dubai is one of the seven emirates that make up the United Arab Emirates (UAE), located on the Arabian Peninsula on the Persian Gulf. It is the most populous and second largest emirate in the UAE. The capital of this administrative unit, and incidentally its only city, is Dubai. It is in Dubai that the majority of the emirate’s population lives. Although the roots of the first settlement in Dubai date back to 3,000 BC, the real breakthrough in the development of the area came after the discovery of oil in 1966. This date marked the beginning of a social transformation and bold, world-renowned construction projects that created a modern port city and a centre for trade and tourism from a small cluster of settlements. Between 1960 and 2022, Dubai’s population grew 80-fold from 40,000 in 1960 to more than 3.4 million today, and the urban and built-up area itself grew 170-fold during this time. Dubai has boarded the accelerating train of change and there are no signs that it is about to stop. The Dubai Urban Master Plan, announced in 2021, announces further urban upgrades focused on improving the quality of life for residents and strengthening Dubai as a global destination for citizens and tourists. As a fortunate Dubai property owner, you will not only be able to observe these changes in person, but also reap the many benefits.
Why is property investment in Dubai a good direction?
Interest in foreign real estate took off during the pandemic. Another watershed moment that sparked interest in this market was the start of hostilities across our eastern border. Dubai proved to be one of the popular investment destinations. What prompts investors to buy property in Dubai is primarily its location, its sunny and attractive climate for most of the year, its international, cosmopolitan atmosphere, its high standard of living and its attractive regulations. Let’s take a look at these in turn.
Location
Dubai is fortunate to lie between Europe, Asia and Africa, so it is ideally suited as a so-called ‘hub’, which is an additional factor for tourism in the country. Thanks to the construction of the airport, as well as the emergence and growth of the local airline Emirates, it has greatly benefited in terms of accessibility in recent years. A definite milestone was the opening of Dubai World Central Airport (DWC), located 37 km from Dubai, to passenger airlines in 2013. At this point, the airport handles the largest number of international traffic passengers in the world. In 2019, it handled more than 86 million in total. Currently, 140 airlines use Dubai World Central. Tourists and property owners in Dubai can fly there from Poland with LOT airlines, as well as low-cost carriers such as Wizz Air. You can find a flight from Poland any day, and the direct one will only take about five hours. If you think of how long it takes to fly from Warsaw to Hel, Dubai seems almost within reach.
Climate and related activities
Dubai lies in the dry tropical climate zone. This is a typically desert climate with very high temperatures and dry air in summer and cooler and shorter winters. In practice, this means 7-8 months of optimum weather, with temperatures reaching 20-30 degrees, which is just right for the Polish autumn and winter. The tourist season in Dubai lasts from September to April exactly. A cloudless blue sky and warm, clear sea await tourists and property owners in Dubai then. The water temperature during this time is around 24-28 degrees, which is conducive to all kinds of water frenzy. And there is plenty to choose from. You can go diving, sailing, jet skiing or kitesurfing. For those who like to do… nothing, on the other hand, beautiful sandy beaches await. Dubai boasts a long and varied coastline. Each beach has a slightly different character, so you can choose between the tranquillity of Al Mamza Lagoon, the sportiness of Kite Beach or the picturesque Sunset Beach. All with excellent infrastructure.
International atmosphere
According to official figures from the Dubai Statistics Center, out of a population of 3,478,300, as many as 91.9 per cent are expats. The increase in this number in recent times has also been influenced by the authorities’ introduction of a visa for freelancers (digital nomads). Yes, this percentage is not only impressive, but makes the atmosphere of the place a real melting pot of nationalities and cultures. The official language is Arabic, but you will find English at every turn here – from menus in restaurants and bars to all kinds of documentation. The range of shops or services is also very unified and not very different from the European standards to which we are accustomed. What else prompts foreigners to invest in property in Dubai? This is a country that has been appearing in the top ten rankings of the best place to live for expats for several years now. In the Expat Insider 22 ranking, organised by InterNations, the Emirate was ranked a high sixth of the best places to live and work in the world. Dubai also has a reputation for respecting other cultures and religions. It celebrates both Christmas, the Hindu festival of light Diwali and the holy month in the Muslim calendar – Ramadan.
High standard of living
The aforementioned Expat Insider 22 report measures various parameters that translate into the quality of life in a given destination. The UAE and Dubai itself ranked high in areas such as safety, health, leisure activities and transport. For our part, we would also add education. The cosmopolitan environment is a guarantee of finding international schools. Those in Dubai are distinguished by their high standard of education. Dubai also falls very high in the security rankings. For example, in the Numbeo Crime/ Safety Index 2019, it was ranked the 3rd safest country in the world. Expats also appreciate the low cost of fuel and taxis and appreciate the government’s investment in urban transport. And when it comes to leisure activities, in addition to beaches and water sports, as a real estate investor in Dubai there is a wide range of dining and entertainment options waiting for you. One thing is for sure, if you are a nightlife lover, you will not be bored here.
Dubai, a stable country and a dynamic property market
Let’s start with Dubai itself. The economy of this emirate is rated as very strong. The country has good relations with the USA, which translates into the constant value of the local currency dirham to the US dollar. The stability of the currency, the absence of inflation in turn influences economic growth, as well as the profitability of investing in the Dubai property market itself. The latter has a reputation for being well valued, with a low risk of a property bubble. According to a Bloomberg report that assesses just this risk, Dubai is at -0.6, where on a scale with a spread from -1 to 3, property markets between 1.5 – 3 are at bubble risk. It is also a very dynamic market. It is very much dependent on the economic climate, the season, on major events such as Dubai Expo 2022 attracting tourists. This creates opportunities for attentive investors. The Dubai government is relentless in its efforts to make the country increasingly attractive to potential residents and for investment. One need only mention the Dubai Urban Master Plan, which has been underway since 1960. This one, planned for 2040, is expected to increase the number of beaches by 4 times, the number of green spaces and hotels by 2 times. So if you are thinking of investing in property in Dubai, the timing is perfect.
Regulations and taxes favour property purchase in Dubai
The UAE government provides a highly regulated market that helps maintain its stability and thus creates a friendly environment for property investment. In Dubai, several rules have been adopted regarding deposit regulation, rent limit and rent increase calculator. In terms of regulation, a treat awaits potential investors in the form of – no taxes on owning or renting property and only 5% VAT. When buying property in Dubai, a one-off fee is payable to the so-called Dubai Land Department (DLD), which is the equivalent of the Polish PCC (tax on civil law transactions). It amounts to 4 per cent, but is often paid in full or in part by the developer when purchasing a property on the primary market. Among other attractive regulations is the possibility to apply for a 3-year investor visa when purchasing a property of 750,000 dirhams (approx. 948,000 pln). This visa will allow you to live permanently in Dubai, open a bank account and have the same rights as any other resident. You also have the option to apply for a loan to purchase a property in Dubai from a local bank. If you are not already a resident, this can be for 50% of the value of the property.
How much does property cost in Dubai and what return can you expect?
Property prices depend on the district. According to the Numbeo website, the price per square metre in the city centre averages 17,494pc and outside the centre 10,795pc. According to Dubai real estate agent Monika Pawlowska-Lukasz, who works with Partners International, ” A one-bedroom flat of about 70 m² in a nice neighbourhood can be bought for as little as AED 1.2 million (about pln 1.5 million).” We can look for a one-bedroom apartment with as little as about 750 000 pln.
You already know the prices, now let’s talk about the possibility of making money from renting. The tourist season in Dubai runs from September to April. Therefore, the most popular model to make money from real estate is to buy a property for tourist rental. Due to the influx of visitors from all over the world, the market for companies managing such rental units is developed and professionalised. And what return on investment can you expect? Here again. It depends. According to Monika Pawlowska-Lukas, the ranges start at 5% and go as high as 18% for a short-term rental of an attractively located property in Dubai. The Numbeo service estimates an average return on investment of 9.5%. We also remind you that income in Dubai is not taxed. Importantly, for long-term rentals in Dubai, there is no practice of paying rent monthly. You either pay for the whole year in advance or quarterly. This protects the landlord from potential problems with a non-paying tenant.
So the question remains when is the best time to invest in Dubai property? A good time to do so is during the summer, when there is a slight drop in demand for flats.
Where to look, or Dubai's most attractive neighbourhoods
If you are considering Dubai for your second home you have a decision to make about which neighbourhood you want to live in. To make this choice easier for you, here are a few neighbourhoods that are popular with expats. The order is random. Here they are:
Downtown (Downtown) Let’s start with the heart of the city with some of the highest property prices in Dubai, but also top attractions at your fingertips. Shopping enthusiasts will find here, for example, the Dubai Mall, the second largest shopping mall in the world, which serves 54 million shoppers a year(!).
Dubai Marina We remain in the centre of Dubai. A famous and rather not-so-expensive district that offers the opportunity to rub shoulders with local luxury. Especially if you opt for a sea-view flat in one of the skyscrapers here. Recommended for singles and couples.
Mirdif For a change, one of the more affordable neighbourhoods in Dubai. It is a good option for those looking for a flat close to the centre at a reasonable price. Optimal for families with children.
Al Barsha Popular with expats. Well connected to the business districts. Mostly villas and semi-detached houses, but there are also some flats. The district has an extensive culinary and entertainment infrastructure.
Sports City As the name suggests, this is a district for fans of an active lifestyle with extensive access to gyms, sports clubs and sports fields. It is also one of the more economical and affordable places in Dubai.
Business Bay The business centre. This is where the Dubai International Financial Centre and Dubai World Trade Centre are located. A district for those who dream of living in a luxury high-rise in the heart of the business world.
Jumeirah Islands (Palm Islands) And finally, a symbol of Dubai and synonymous with luxury. 50 artificially created islands visible from space. It is almost a self-sufficient area with its own schools, hospitals, shops and gyms. For those with an affluent wallet.
Let's recap!
Why invest in property in Dubai?
We are at a particular historical moment. The pandemic and then the warfare in Ukraine have contributed to a shift in our priorities. The way we invest in real estate has also changed. We are no longer just looking for profit, but for a place that can be a second home where we recharge our batteries or even a plan B for unexpected political crises. All this will be provided to you by investing in Dubai property. Let’s summarise why this is a good direction.
1. Dubai’s stable and strong economy, stable local currency and lack of inflation make the country a good place to invest. The emirate is constantly expanding. The Dubai Urban Master, announced in 2021, aims to have four times as many beaches, twice as much green space and twice as many hotels by 2040.
2. Regulations such as no taxes on the purchase of property, no income tax, 5 per cent vat, the ability to apply for a resident visa for property purchases over 750,000 dirhams, the practice of the tenant paying rent quarterly, or annually, encourage the profitability of property investment in Dubai.
3.Prices for luxury properties are competitive compared to European cities. According to a Knight Frank report (2019), they cost on average around 53% compared to Berlin.
4. With a tourist season lasting 7-8 months and a 9% average return on investment (according to Numbeo), Dubai’s property market has high economic potential. By choosing to purchase an attractively located property and then rent it out to tourists, you give yourself the opportunity to generate an attractive income.
5. A number of factors such as convenient international connectivity, including low-cost airlines flying from Poland, a moderate climate and high sunshine that promotes a good mood for most of the year, high levels of security and education make Dubai an ideal place for your second home.
6. A very high (91.9%) percentage of expats giving many advantages such as the ubiquitous English language and cosmopolitan atmosphere.
7. Dubai property investment is a capital hedge against galloping inflation in Poland.
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