Business | Property
Two-thirds of new property owners are foreigners
Two out of three new freehold properties in the UAE are bought by foreign corporates or individuals who live outside the country, according to a Dubai developer.
- Staff Report
- Published: 00:06 May 27, 2008
Dubai: Two out of three new freehold properties in the UAE are bought by foreign corporates or individuals who live outside the country, according to a Dubai developer.
MAG Group Property Development, which is looking to grow its portfolio of projects to more than Dh10 billion ($2.1 billion) by 2012, said final home owners account for just 30 per cent of the market and only five per cent of them are UAE nationals.
"It is not difficult to understand why," said MAG Group CEO Mohammad 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 said foreign investment by both developers and buyers remains vital for the growth of the real estate sector. Foreign individuals and corporates currently represent between 60-70 per cent of buyers of freehold units, he said.
Nimer also said some developers were re-purchasing properties they had developed from current owners to re-invest them in the market with returns ranging between 20-30 per cent. Around two to five per cent of developed properties are re-purchased by developers, he said.
MAG Group currently has five property projects across Dubai worth Dh3 billion and is expected to grow its portfolio to Dh5 billion over the next two years, Nimer said.
Investing in property in the UAE is seen as safe and rewarding and currently better than investing in bonds or stocks."
Mohammad Nimer
CEO, MAG Group
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