Even as the domestic real estate market remains muted, Indians seems to be making investments in the Dubai realty market outshining capital inputs from British and Russians.

Indians have pumped close to ₹13,600 crore into the sector in the first half of 2016 following which developers are luring Indians with competitive deals.

“Dubai’s real estate market is becoming an attractive proposition to a multitude of international investors. However, no other nation invested more money into Dubai than India, with little over half-a billion dollars that is, ₹3,400 crore worth of investments in 2011; the investments from Indians have gone up 10 times in the last four years. Last year itself, they poured in ₹37,060 crore ($5.45 billion) which was again an increase of 10 per cent from the previous year,” said Asanga Silva, Deputy General Manager, Sumansa Exhibitions, the company bringing in Dubai Property Show to Mumbai.

He said Indians like to invest in Dubai as it provides high capital gains, great return on investment, tax-free environment, proximity to India and transparent deals.

Overall, Indians have pumped in a total of ₹1,24,440 crore ($18.3 billion) into Dubai realty since 2011.

According to data from the Dubai Land Department (DLD), released by its Real Estate Research and Studies Department, the total investment transactions for the first half of 2016 reached ₹10,2,000 crore ($15 billion) from 26,000 investors made up of 149 different nationalities.

In terms of expat investors, after Indians, British citizens were the second biggest group of purchasers of property, splashing out ₹7,344 crore ($1.08 billion) through 2,010 transactions.

Investment in Dubai is but a rational choice. Apartment rental returns in the city offer yields in the range of 7-12 per cent. When compared to yields in London (3.5 per cent), Hong Kong (2.82 per cent) and Singapore (2.83 per cent), Dubai becomes all the more attractive for investment.

Masood Al Awar, Chief Commercial Officer, Dubai Properties, a realty developer of Dubai, said, “Our participation in this year’s Dubai Property Show India highlights our role in leading the development drive across Dubai with a broad choice for end-users and investors in residential and commercial real estate. Dubai Properties enjoys a diversified customer base spanning across different nationalities and Indian investors are a very important target group for us both from within the UAE and abroad.”

Anuj Puri, Chairman & Country head, JLL India said, “Traditionally, there has been a high affinity for physical assets such as precious metals, jewellery and real estate among Indians...Indian property investors in the upper income brackets are also increasingly attracted to real estate options abroad. The preferred locations include cities such as New York, London and Singapore, and also Dubai because of the relatively cheaper options available there.”

Puri said according to the leading UAE property portal Bayut.com, Indians looking for Dubai properties accounted for 66.86 per cent of total search hits on the website in 2015.

The rationale driving such interest is not hard to identify — $1 million will buy an investor a mere 96 sq m land in Mumbai, while the same amount fetches a 145-sq m property in Dubai.

Meanwhile, developers such as Sobha Group has recently introduced new land plots for investors and end users within Sobha Hartland – an integrated freehold community in the Dubai.

Sobha Developers said post demonetization, it expects the Indian investments in Dubai property to surge. The company said it is seeing a surge in enquiries.

Under RBIs Liberated Remittance Scheme, a couple can transfer ₹3.4 crore legally per year.

PNC Menon, Founder and Chairman, Sobha Group, said, “Real estate investments in Dubai are regarded as a good decision especially with Dubai being considered as the region’s safe haven and the city recently has also climbed to No.2 among world’s cities with ‘most improved livability’”.

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