Two out of three of all new freehold properties in the UAE are bought by foreign corporates or individuals who live outside the country, according to one of Dubai's leading property developers.
MAG Group Property Development, which is looking to grow its portfolio of new property projects, said in a Press release that final home owners currently account for just 30 per cent of the market and only 5 per cent of them are UAE nationals. "It is not difficult to understand why," says MAG Group CEO Mohammed Nimer. "Investing in property in the UAE is seen as safe and rewarding and currently better than investing in bonds or stocks. "In spite of numerous challenges, such as rising costs and shortage of contractors, the real estate sector in the UAE is still one of the most important investment areas in the country. The return on the investment can reach as high as 40 per cent — an unbeatable figure."
Nimer says foreign investment by both developers and buyers remains vital for the continued growth of the real estate sector. Foreign individuals and corporates currently represent between 60-70 per cent of buyers of freehold units, he claimed. Nimer also revealed that some developers are now re-purchasing properties they have developed from current owners to re-invest them in the market with returns ranging between 20-30 per cent.
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