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After a turbulent few years during which the price of property has dipped and rents have experienced a readjustment, now is the ideal time to invest in Dubai's real estate sector, according to a leading independent financial advisory firm.
The emirate's property market has gone through a period of re-evaluation in recent years. Where once speculation and inflation were the norm, nowadays landlords and investors take a far more cautious, some might say realistic, approach to operating in the sector - say experts at independent financial advisers, Holborn Assets.
Joanne Phillips, General Manager of the Mortgage Division at Holborn Assets, believes an oversupply of units, lower rents and a dip in values have contributed to a major reshaping of the property landscape.
Joanne said: "Old predictions of 'continuous growth' have been replaced with more grounded ideas of what is achievable as the sector continues to mature beyond the 'bubble' that enveloped it prior to the 2008 financial crisis.
"With this maturity comes stability, something that appeals to smart investors who are looking for long-term returns with sustainable growth and aren't afraid to ride out a few bumps in the road.
"And bumps do come around. 2017 was widely recognised as a 'testing' time for the market, with various issues rearing their head such as an overall 12 per cent drop in rental prices, a decrease in 4 per cent across all quality brands and a 20 per cent decline in 'luxury' areas such as Dubai Marina and Downtown Dubai.
"While this could be interpreted as a warning, property in Dubai still presents investors with many exciting opportunities."
According to Joanne and her team of experts at Holborn Assets, the reasons for this are two-fold – the dip in prices over the last 18 months has made the market more accessible and, most importantly, the continuing lack of taxes, specifically related to capital gains, property appreciation, salaries and rental yields, means there is potential for strong returns on your investment.
Joanne continued: "We are expecting property in some areas of Dubai to perform particularly well, such as Jumeirah Village Circle and Dubai South. These recorded the highest number of off-plan transactions last year and combine growth potential with solid returns.
"Other neighbourhoods to pay close attention to include Discovery Gardens, International City, Jebel Ali and Dubai Creek Harbour. Very recently there has also been a surge in interest in the Sustainable City and Sports City areas as buyers are willing to look further outside the city to get more for their money.
"It is also important to note that predictions that the market is set to be flooded with more than 120,000 new properties ahead of Expo 2020 should be calmed by the likelihood that not all will be finished on schedule. This means any disturbance to the sector is unlikely to be felt for some time yet, so now is a good time for first-time buyers/investors to take their first steps on the property ladder."
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