– Santhosh Kumar, Group Vice Chairman
I had recently written a blog about the growing interest of NRIs to invest in Indian real estate. But the trend that I want to talk about today is how UAE has become a hot destination for Indians… not only to travel but to invest.
Thanks to India’s booming economy, today, several millionaires are heavily investing in real estate across countries, and UAE surely tops the charts. According to an Asia-Pacific Wealth Report, Indians are the highest investors in foreign real estate with a 50% market share.
The rising US dollar is amplifying the global nature of UAE’s real estate market, especially with the appealing government incentives and regulations put in place.
Earlier, only big corporates and celebrities used to invest overseas in property either for business or leisure; however, these phenomena have changed.
Why has UAE picked up suddenly?
It’s not sudden. It is one of the fastest developing regions in the world, with a robust economy that has been growing steadily over the past few decades. This growth has led to high demand for housing, and commercial and retail spaces, making the territory a prime target for real estate investment.
Over the last 5 years, investment in UAE has witnessed significant growth with a range of different asset classes that individuals can choose from with the objective of wealth creation.
Realistic AI data reports predict that the cost of real estate in Dubai may rise by 29% in 2023. With a stable exchange rate between the US dollar and UAE dirham, we are going to see an upward trend with prices rising at least by 10-15% and in some cities, it may even go up to 46% as per the data.
UAE stands out.
In the last 2.5 years, it has become a ‘post-pandemic’ investment destination. Three simple reasons – the legal, financial, and regulatory environment in UAE is extremely business friendly; it is a stable, investor-friendly global hub; and one of the world’s easiest places to do business.
Attractive due to distinct reasons
Indians prefer UAE and especially Dubai as their second home for a variety of reasons – a good lifestyle, a vibrant tourist destination, a short travel from India, high rental yield, friendly government policies, tax-free investment, safety, infrastructure, and much more.
Another especially important point that I would like to highlight is the Golden Visa relaxation. This is a long-term visa to reside, work, invest, do business, and start your own business in the Emirates. We are seeing huge interest from entrepreneurs, professionals and investors, specialists in the medical, scientific, research and technical fields.
New reforms are driving a realty boom but adhere to caution.
There is a growing Indian community settling down in UAE, and if you are deciding to invest, it is imperative to follow the Liberalized Remittance Scheme (LRS) of the Reserve Bank of India guidelines which state that $250,000 per person is the upper limit that an Indian can invest in a year and your property price can’t exceed that.
Another thing to keep in mind is the income tax implication on the returns and investments you make in the global market, it is a mandate by the tax laws of both India and the country you are buying the property.
One of the biggest advantages of investing in the UAE is the absence of income and capital gains tax. This makes it an attractive destination for investors, especially those who are looking for tax-efficient ways to invest their capital.
Innovative and Productive Infrastructure
UAE has developed a state-of-the-art infrastructure that includes world-class transportation systems, advanced healthcare facilities, and top-quality educational institutions. This has resulted in a high quality of life with long-term potential, which provides a solid foundation and confidence to both local and international investors.