Forget the chrome and glass towers dominating Dubai’s skyline for a moment. The real estate goldmine lies in the city’s thriving secondary market, where seasoned investors are reaping significant returns. Dubai’s relentless growth has created a wealth of established communities, offering a unique blend of affordability, character, and untapped potential.
When it comes to residential property in the UAE, the focus has traditionally been on the ‘new’. With so much space and rapid growth, developers have been churning out homes for the ever-expanding population. However, in 2024, Dubai is a mature city with over three million residents, and it’s time to capitalise on the immense potential of its resale market.
Ideal conditions are converging to make this a perfect storm for investors
Since the slowdown caused by the COVID-19 pandemic, a surge of developments has begun in Dubai and the vast new district surrounding Dubai South and Al Maktoum International Airport, soon to be the world’s largest.
Property rental prices across Dubai are rising, with a phenomenal 12.1% rental growth, while mortgages remain comparatively affordable
This creates a prime opportunity for investors in the secondary market. Rental yields are higher than mortgage payments, meaning investors can expand their portfolios while earning immediate returns from tenants. With an estimated 40,000 new residential completions in Dubai every year and a projected population increase of 500,000 in the next decade, this situation is unlikely to change.
The increased development does not diminish the appeal of Dubai’s older, established communities
Many are even more desirable today than when they were launched, even if some of those properties require upgrades. This creates excellent opportunities to buy, renovate, and resell for significant capital appreciation.
The colossal expansion of Al Maktoum International Airport will significantly impact Dubai’s geography in the coming decade, transforming the city’s landscape and infrastructure as it evolves into a global aviation and logistics powerhouse. This mega-project will reshape Dubai’s skyline, connectivity, and economic dynamics, leaving an enduring mark on the city’s future. Investors who have already purchased, or are considering buying, in neighbourhoods like Dubai South and Emaar South are positioned to see remarkable returns on both rental yields and resale values.
The UAE’s wealth demographic is evolving, with increasing numbers of millionaires and billionaires attracted by the country’s favourable conditions, particularly its tax-free status. In 2022 alone, the UAE attracted a net influx of 5,200 millionaires, followed by 4,700 in 2023, bringing the total millionaire population to 116,500. The UAE is expected to draw about 5% of the 128,000 millionaires relocating globally in 2024.
Along with these individuals, global businesses are establishing headquarters in what is the financial centre of the Middle East. This influx of new residents will translate into a sustained demand for rental properties.
Dubai is experiencing a rapid metamorphosis, driven by the ambitious Dubai Urban Masterplan 2040
A key component of this transformation is the city’s evolving infrastructure. Expanded road networks and the burgeoning Dubai Metro are redefining urban mobility. This enhanced connectivity is liberating residents from the traditional proximity to workplaces, unlocking the potential of previously undervalued areas. As accessibility improves, these districts are blossoming into vibrant communities, attracting residents with a range of amenities including leisure facilities, world-class schools, and community healthcare. These developments are not only enhancing quality of life but also driving significant capital appreciation in the UAE’s secondary property market.
If that isn’t enough, purchasing property in Dubai not only grants access to the UAE’s investor visas, offering buyers unrestricted access to the region’s high living standards and tax advantages, but it also provides significant peace of mind thanks to the country’s remarkable safety and security.
According to recent reports, cities in the UAE, including Dubai, consistently rank among the top 10 cities globally with the lowest crime rates. This exceptional level of safety, coupled with the region’s advanced infrastructure and world-class amenities, makes investing in Dubai’s property market not just a financial decision, but a lifestyle upgrade. Buyers can enjoy their investment with confidence, knowing that they and their families are living in one of the safest environments in the world.
As the UAE’s real estate market continues to evolve, expert guidance is essential to navigate the complexities and maximise returns.