International buyers are the cornerstone of the emirate’s real estate market, attracted by its strategic location, tax-free status, and welcoming investment environment.
Investors from Australia, the UK, Europe, North America, Turkey, and Iran are expected to drive the next growth cycle of the Dubai property market. They are attracted by higher returns compared to major markets, a tax-free environment, rising taxes in their home countries, and challenging conditions there.
Industry experts indicate that, alongside these nationalities, investors from traditional markets like India, Pakistan, and the Middle East will also remain significant contributors to the promising fourth growth cycle of Dubai’s real estate sector.
The emirate’s real estate market has experienced three distinct cycles: before the global financial crisis of 2009, around 2014, and post-Covid. Many industry experts believe the third cycle, which peaked in 2023-24, is nearing its end. Consequently, the fourth cycle is expected to commence soon, driven by an anticipated increase in foreign investment.
The fourth cycle will not be a boom-bust cycle but rather a slight correction before the next phase of growth begins.
Guillaume Giroux, CEO of Elysee Vendome Real Estate, stated that Dubai is nearing the end of its third property cycle, with a new cycle on the horizon. This upcoming cycle is expected to attract buyers from various countries.
“French investors continue to show interest in Dubai’s properties, driven by uncertainties in Europe that prompt them to look elsewhere. It is anticipated that various European nationalities will have a significant influence on Dubai’s property market in the future.”
He mentioned that high taxes and lower returns in their home countries are leading investors to seek better opportunities abroad. “Challenges such as strict regulations in France are also encouraging investors to move towards markets with higher returns and stable rules.”
Mouna Muller, a client manager at Betterhomes, noted that as Dubai’s third property cycle concludes, the upcoming fourth cycle is expected to be driven by a diverse range of investors.
He mentioned that the likelihood of higher taxes in the UK, Australia, and Europe is anticipated to drive investors from these regions to consider Dubai due to its tax-free environment and favorable investment conditions.
“Europeans are drawn to Dubai because of its appealing lifestyle, business opportunities, and favorable residency programs. Iranians seek economic and political stability, along with cultural connections and proximity to Dubai. Turkish investors are attracted by the need for economic diversification, business opportunities, and the high demand for high-quality real estate in Dubai,” he stated.
Muller highlighted that investors from India, China, Iran, Turkey, and other nations will also play crucial roles, influenced by various economic and geopolitical factors.
Ramjee Iyer, chairman and managing director of Acube Developments, noted that investors from countries with relatively high taxes, such as the UK, Australia, and most of Europe, understandably seek tax-efficient investment opportunities abroad, and Dubai’s tax-free environment is highly attractive to them.
Chinese replacing Russian investors?
Industry experts suggest that the influx of Russian investors has slowed down and they will be replaced by Chinese investors, who are expected to become major players in the local property market.
Ramjee Iyer stated that recent data indicates British investors have surpassed Indians this year as they flock to the UAE for Golden Visas, tax-free benefits, high rental yields, and the emirate’s renowned luxury lifestyle.
“The Chinese will also become a significant force in the Dubai market due to the two nations’ strong economic connections and enhanced political ties. Other nationalities to watch include those from Turkey and Iran. Turkish buyers value Dubai’s robust economy and innovative projects, while Iranian buyers are attracted to Dubai’s peaceful environment, career opportunities, and economic stability.”
Buying to live
Paul Christodoulou, CEO of Aqua Properties, also predicted increased interest from European investors, with Germans gaining momentum.
“The British presence has always been significant, and currently, we are seeing an even greater influx of British investors. Additionally, investors from Australia, Singapore, and North America, particularly the US and Canada, are emerging as key players in Dubai’s property market, drawn by Dubai’s zero per cent tax on investments and income tax.”
He mentioned that investors from Europe, Britain, and Australia are attracted by the long-term residency options and the highly appealing return on investment (RoI).
Christodoulou noted that investors looking to relocate with their families through the Golden Visa and expand their Dubai property holdings are also purchasing properties in Dubai.
“Many of these buyers approach investments with the intention of initially securing a profitable asset, with the potential to transition to living in Dubai within a few years. These investors start with a short-term investor mindset but keep a long-term living perspective in mind,” he explained.
He emphasized that Dubai is becoming more of an end-user market, with residents increasingly investing. “Recent transactions show that nearly 60 percent of sales in 2024 were off-plan, indicating strong investor interest. However, many foreign investors are predominantly residing in Dubai and are UAE residents.”
Foreign investors continue to dominate
International buyers are the cornerstone of Dubai’s property market, attracted by its strategic location, tax-free status, and favorable investment environment.
“This trend is expected to remain strong as Dubai continues to attract foreign investors. However, there is growing interest among UAE residents in property investment, which could help stabilize the market over time,” Muller stated.
Ramjee Iyer emphasized that foreign investors, including expat residents and non-resident buyers, significantly influence Dubai’s property market. “Their interest in Dubai is driven by factors such as security, high rental yields, tax incentives, and lifestyle opportunities, and I don’t see this trend changing anytime soon. If anything, it will strengthen.”
Guillaume Giroux of Elysee Vendome Real Estate added that the majority of investors are from outside the UAE, primarily from Europe.
