Local Expats Poised to Drive Next Property Market Boom in Dubai
Local expats accounted for 40% of all property purchases in Dubai last year, and this figure is projected to reach 50% by 2025, industry experts said.
Local expats are poised to lead the next property market boom in Dubai and the UAE, driven by the rising rent costs and the increasing allure of the county’s economic growth prospects and stability, a latest market survey and industry insiders said.
Dubai is also fast transitioning from being just an attractive real estate investment destination to a place of choice to settle down on a long-term basis for families from around the world, aided by numerous government initiatives aimed at deregulating the economy and attracting talented expatriates.
Local expats accounted for 40 percent of all property purchases in Dubai last year, and this figure is projected to reach 50 percent by 2025, industry experts said.
The prospects of a high-return on investments based on expectations of continued price rise in Dubai’s property market is also expected to further drive expat investments in Dubai’s real estate market.
“The increasing cost of rent in Dubai has become a significant driving force behind the decision of local expats to invest in property rather than continuing to bear the burden of escalating rental rates,” Abhishek Jha, CAO and Managing Partner of Foremen Fiefdom, a Dubai-based leading real estate investment firm, told Arabian Business.
Buy vs Rent debate
A latest consumer survey by global digital consultancy RedSeer showed that a significant portion – about two-thirds – of local expats and residents are opting to purchase property rather than renting, as rental rates continue to increase.
“With residential rents on the rise, coupled with growing confidence in the UAE’s real estate market, the decision to rent or buy property has become increasingly important [for local expats],” revealed the survey by RedSeer Strategy Consultants.
Dubai real estate: Property sales soar 46.71% in first quarter, strong growth expected in 2023
“This shift in consumer behaviour also reflects the growing preference for long-term stability and financial security that property ownership provides,” it said.
Russian investors still dominate upscale property market
The RedSeer study also showed that wealthy Russian expatriates still dominate Dubai’s – and also UAE’s – upscale residential real estate market.
“The Russian buyers demonstrate a preference for villas, accounting for approximately two-thirds of their investments,” the study said.
“Impressively, 80 percent of these transactions involve secondary sales, with an average ticket size of $1.1 million, twice that of the market average,” RedSeer said.
Surge in local expat investments
Jha said besides the rising rental costs, there are a multitude of other factors that contribute to the expected surge in local expat involvement in the property market in Dubai and the UAE.
“The UAE’s robust economic growth, stability and prosperity and favourable regulatory environment solidify the appeal of property investment for this demographic [segment],” Jha said.
“Taking into account these factors, the trend of local expats venturing into property ownership is likely to persist,” he said.
The RedSeer study said as one of the world’s fastest-growing economies, Dubai presents a plethora of opportunities for career advancement and a high standard of living.
“The UAE stands out as one of the most economically viable geographies for real estate investment, boasting the lowest price-to-income ratio compared to other regions of interest,” the study said.
It said though Dubai’s real estate market has rebounded well after Covid-19, the market is now only back to its 2019 price level, and still 20-25 percent below its 2014 peak.
“While real estate rentals and property prices have been going up in UAE recently, people often don’t appreciate that it is still one of the most attractive markets globally when it comes to property price-to-income ratio,” Akshay Jayaprakasan, Associate Partner at Redseer Strategy Consultants, told Arabian Business.
“While the story over the last year was about wealthy immigrants buying properties in the region, going forward we expect current residents to play a vital role in property purchases, also taking into account the steep rise in rental rates,” he said.
Jayaprakasan said Dubai has also evolved from being just an attractive real estate investment destination to a place of choice to settle down for families in the long term, thanks to the numerous government initiatives aimed at deregulating the economy and attracting talented expatriates.
Real estate agents vs Social media promos
The RedSeer survey also highlighted the growing trend of social media posts and promos playing an increasing role in buyers’ decision making for property investments in the UAE.
“In today’s digital era, real estate agents on social media platforms have gained significant influence in the real estate industry,” the survey findings showed.
“They are increasingly using digital media channels to advertise and build their following, positioning themselves as real estate content creators and consequently, blurring the lines between agents and content creators in the industry,” it said.
Joanne Chehab, Head of Business Partnerships for Managed Services, Global Business Solutions, MENA at TikTok said the conventional approach to real estate marketing no longer works, as user attention is saturated by the sheer amount of information available to them in a competitive real estate market.
Real EstateDubai real estate sector records $1.1bn day
Revealed: Local expats poised to drive next property market boom in Dubai
Local expats accounted for 40% of all property purchases in Dubai last year, and this figure is projected to reach 50% by 2025, industry experts said
Local expats are poised to lead the next property market boom in Dubai and the UAE, driven by the rising rent costs and the increasing allure of the county’s economic growth prospects and stability, a latest market survey and industry insiders said.
Dubai is also fast transitioning from being just an attractive real estate investment destination to a place of choice to settle down on a long-term basis for families from around the world, aided by numerous government initiatives aimed at deregulating the economy and attracting talented expatriates.
Local expats accounted for 40 percent of all property purchases in Dubai last year, and this figure is projected to reach 50 percent by 2025, industry experts said.
The prospects of a high-return on investments based on expectations of continued price rise in Dubai’s property market is also expected to further drive expat investments in Dubai’s real estate market.
“The increasing cost of rent in Dubai has become a significant driving force behind the decision of local expats to invest in property rather than continuing to bear the burden of escalating rental rates,” Abhishek Jha, CAO and Managing Partner of Foremen Fiefdom, a Dubai-based leading real estate investment firm, told Arabian Business.
Abhishek Jha, CAO and Managing Partner of Foremen Fiefdom
“With a substantial 20 percent surge in average rental prices for two-bedroom apartments in 2023, many local expats perceive property ownership as a viable alternative,” Jha said.
Buy vs Rent debate
A latest consumer survey by global digital consultancy RedSeer showed that a significant portion – about two-thirds – of local expats and residents are opting to purchase property rather than renting, as rental rates continue to increase.
“With residential rents on the rise, coupled with growing confidence in the UAE’s real estate market, the decision to rent or buy property has become increasingly important [for local expats],” revealed the survey by RedSeer Strategy Consultants.
Dubai real estate: Property sales soar 46.71% in first quarter, strong growth expected in 2023
“This shift in consumer behaviour also reflects the growing preference for long-term stability and financial security that property ownership provides,” it said.
Russian investors still dominate upscale property market
The RedSeer study also showed that wealthy Russian expatriates still dominate Dubai’s – and also UAE’s – upscale residential real estate market.
“The Russian buyers demonstrate a preference for villas, accounting for approximately two-thirds of their investments,” the study said.
“Impressively, 80 percent of these transactions involve secondary sales, with an average ticket size of $1.1 million, twice that of the market average,” RedSeer said.
Surge in local expat investments
Jha said besides the rising rental costs, there are a multitude of other factors that contribute to the expected surge in local expat involvement in the property market in Dubai and the UAE.
“The UAE’s robust economic growth, stability and prosperity and favourable regulatory environment solidify the appeal of property investment for this demographic [segment],” Jha said.
“Taking into account these factors, the trend of local expats venturing into property ownership is likely to persist,” he said.
The RedSeer study said as one of the world’s fastest-growing economies, Dubai presents a plethora of opportunities for career advancement and a high standard of living.
“The UAE stands out as one of the most economically viable geographies for real estate investment, boasting the lowest price-to-income ratio compared to other regions of interest,” the study said.
It said though Dubai’s real estate market has rebounded well after Covid-19, the market is now only back to its 2019 price level, and still 20-25 percent below its 2014 peak.
“While real estate rentals and property prices have been going up in UAE recently, people often don’t appreciate that it is still one of the most attractive markets globally when it comes to property price-to-income ratio,” Akshay Jayaprakasan, Associate Partner at Redseer Strategy Consultants, told Arabian Business.
Akshay Jayaprakasan, Associate Partner at Redseer Strategy Consultants
“While the story over the last year was about wealthy immigrants buying properties in the region, going forward we expect current residents to play a vital role in property purchases, also taking into account the steep rise in rental rates,” he said.
Jayaprakasan said Dubai has also evolved from being just an attractive real estate investment destination to a place of choice to settle down for families in the long term, thanks to the numerous government initiatives aimed at deregulating the economy and attracting talented expatriates.
Real estate agents vs Social media promos
The RedSeer survey also highlighted the growing trend of social media posts and promos playing an increasing role in buyers’ decision making for property investments in the UAE.
“In today’s digital era, real estate agents on social media platforms have gained significant influence in the real estate industry,” the survey findings showed.
“They are increasingly using digital media channels to advertise and build their following, positioning themselves as real estate content creators and consequently, blurring the lines between agents and content creators in the industry,” it said.
Joanne Chehab, Head of Business Partnerships for Managed Services, Global Business Solutions, MENA at TikTok said the conventional approach to real estate marketing no longer works, as user attention is saturated by the sheer amount of information available to them in a competitive real estate market.
Joanne Chehab, Head of Business Partnerships for Managed Services, Global Business Solutions, MENA – TikTok
“In the age of information overload, buyers and renters are seeking authentic storytelling and visuals that give them a glimpse of their dream homes, even before they do a real viewing,” Chehab told Arabian Business.
Chehab said as buyers and renters increasingly look to online communities for unbiased views, real estate marketers have much to gain from connecting with the community on social media platforms like TikTok with authentic, relevant content that can educate and entertain.
