Dr. Mahdi Al Asuid, |
It turns out that there are two types of foreign investors - those who invest in holiday destinations where there is a steady demand for housing, and those who invest in a particular country, first by studying house prices and existing trends. The sun, sea and low-cost flights in their time became incentives for buying property in Spain and France, making these countries a popular place to buy a second home or cottage, while more prudent investors turned their attention to the countries of Eastern Europe. In Latvia and Lithuania, the fastest growth in housing prices is observed today, while in Bulgaria studio apartments are offered at a price lower than the average down payment for such housing in the UK. Those who already have homes abroad, and those investors who are called the generation of “quick tenants,” today turn their attention to the sun, sandy beaches and quick and profitable return on investment in the UAE.
British investment in holiday destinations began sometime in the 1970s, when it became fashionable to spend your holidays in overseas resorts. Many investors were attracted to Los Angeles, Malibu, California and Miami Beach, where high society gathered, and Frank Sinatra and Sammy Davis could be seen in popular nightclubs and piano bars.
In the 1980s, real estate investments turned in the direction of cities and places popular due to their culture and grace, such as the Cote d'Azur, Cana and Nice, which became very popular among holidaymakers. Marbella, Spain and the Algarve in Portugal also had increased demand among investors. In the 1990s, after the fall of the "iron zan weight", real estate investment shifted towards new markets, namely the countries of Eastern Europe. The cost of construction in the United States at that time reached sky-highs, and many investors could no longer count on stable profits in such a competitive market. The cities were so upset that the secondary housing market became static. Developers no longer planned new housing projects and resort complexes. At the same time, the rapid development of cities led to higher prices for consumer goods and services, and there were serious concerns about population growth, road planning, and safety. I personally successfully invested in California, but I realized that such a situation would reduce investor interest. It was obvious that many buyers, once a nightly entertainment, began to become interested in the more positive and familiar secondary housing market in Europe. Recent studies have shown that more than 300 thousand British people have second country houses abroad. These figures are three times higher than in 1995, and it is expected that by 2025 more than one million residents of Foggy Albion will become owners of suburban homes located outside their country. The same studies showed that two thirds of primary home buyers intend to invest in real estate abroad. Dubai attracts many of them, as it offers sun, sea and entertainment all year round, combined with high profits and investment protection.
Dubai has become a popular tourist destination because of the luxurious lifestyle offered by a whole range of five star hotels and resorts, spa, as well as a tax-free system and a stable currency. New homes such as The Palm Island, Mall of the Emirates, and Dubai Mall further strengthen the market and increase demand for holiday homes, hotels and apartments for short-term rentals.
British investment in Dubai continues to grow, but many investors believe that the city cannot develop so rapidly all the time. This phenomenon is known as the “soap bubble theory”, and the question is only when this “bubble” bursts.
However, the decline of the "national" market and its economy, associated with the fall of international markets, is not observed. Investors should take into account that real estate in Dubai costs much less than real estate in other popular resort areas of the world. This is one third of the cost of real estate in Marbella, one fifth of the prices in Cannes, and one tenth of the prices of similar housing in London.
The economy continues to grow and expand thanks to projects such as the Dubai Healthcare City and the Dubai Multi Commodities Center, which increase turnover, develop communication and services, and also provide incentives for many professionals to relocate to Dubai. Similarly, the areas of Business Bay and DIFC (Dubai International Financial Center) will stimulate investors and create more and more jobs in the emirate. The Dubai government is also involved in the development and construction of the emirate. This means that the interests of the government and investors coincide, and that Dubai is an ideal place for investment.
