United Arab Emirates Investment Growth

The UAE offers investors a diverse, fast growing economy. Property buyers are experiencing strong returns on investment in many of the emirates.


Investment property in the UAE is widely considered to be one of the best worldwide investment vehicles available today. This is due to a number of reasons, not least the fact that there is enormous demand for luxury accommodation not only in Dubai, but now also in the other emirates, inevitably leading to high capital growth.

Tourism is a major driving factor for real estate growth in the UAE. With UAE tourism being one of the fastest growing tourist industries in the world and estimates indicating that it is to grow by some 4.9% per annum until 2017, investors are wasting no time in purchasing early, while prices are still low. Emirates such as Abu Dhabi, Ras al-Khaimah and Ajman as well as Sharjah and Umm al-Qaiwain are seeing an unprecedented surge in real estate projects, all with the firm intent of supplying an as yet un-sated demand for real estate in the UAE.

The absence of taxes and a low cost of living are clear incentives for all investors, and this draws many foreign companies to establish activities in the Emirates’ free zones and industrial cities. Expatriate workers represent some 75% of the population and, in addition to quality business premises, they seek luxury accommodation on which to spend their tax-free earnings, all with obvious positive effects upon the market.

Capital Growth Predictions

Following Dubai’s footsteps, property prices are now poised to soar in many of the UAE’s other emirates. For example, land prices in Abu Dhabi this year have already risen by 75%, according to HSBC Middle East. A spokesman for the bank has said, "We estimate that average residential real estate prices will increase by a further 20-25% over the remainder of 2008, with a total of more than 100% for the whole of 2008, and by 15-20% in 2009".

Indeed capital growth across the emirates is predicted to average 20-40% per annum. This growth is expected to continue in the UAE for some years to come as land costs are continuously driven upwards.

Rental Yield Predictions

Capital growth, combined with average rental yields of 6-10% p.a. make now an ideal time to invest in UAE property.

UAE Economy

Boasting one of the most highly developed and industrialised economies on the planet, the UAE attracts record numbers of international investors, visitors and expatriates. GDP growth rate in 2007 stood at 7.4%, while predictions from The Economist forecast an average 7.6% p.a. for the period 2008 to 2012.

UAE tourism already accounts for 0.5% of worldwide tourism, and in the Emirates it is forecasted to grow by some 4.9% per annum until 2017. Real estate activity is in full swing, producing a vast array of awe-inspiring hotels and resort developments.

Reasons why the UAE is an intelligent property investment location:

  • Thriving, highly developed economy attracting worldwide investors
  • GDP per capital ranks 5th in the world and 3rd in the Middle East, after Qatar and Kuwait
  • GDP growth rate of 7.4% (2007)
  • Economic growth rate forecast of 13%
  • Strong capital appreciation of average 20-40% depending upon emirate
  • Rental yields of 6-10% p.a.
  • Liberalised policies encouraging foreign individuals and companies to invest
  • No taxes, along with free trade zones and a relatively low cost of living
  • Outstanding constructions and state-of-the-art designs in residential, commercial and recreational properties
  • Well developed and maintained infrastructure to meet top international standards
  • Fast expanding tourism industry

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