As the Managing Director of MILK Real Estate, I have observed a significant rise in interest from Non-Resident Indians (NRIs) in Dubai’s real estate market. The appeal is clear—favorable returns, tax advantages, and the option for long-term residency. However, it’s crucial for potential investors to understand what makes Dubai an attractive market and what considerations should guide their investment decisions.
Why Dubai is a Strong Market for NRI Investors
Dubai’s real estate market offers distinct advantages that set it apart from other global destinations. The absence of income tax and capital gains tax is a major draw, enabling investors to retain more of their returns. In many cases, returns on investment (ROI) can reach up to 10%, making Dubai a competitive choice for those seeking robust financial growth.
The UAE’s open approach to property ownership, without restrictions for NRIs, adds further appeal. Additionally, investments exceeding AED 2 million can qualify for a Golden Visa, providing the added benefit of long-term residency.
Selecting the Right Location
Location is a critical factor in real estate investment, and in Dubai, the right choice can make a significant difference. I recommend focusing on areas where infrastructure, connectivity, and development potential align. Communities such as Dubai Hills Estate, Dubai Creek Harbour, Business Bay, and Meydan are noteworthy. These areas offer a blend of established infrastructure and future growth potential, making them attractive for long-term capital appreciation.
Jumeirah Lake Towers (JLT) is another area that stands out, particularly for NRI investors looking for a balance between residential living and business proximity. Its location near Sheikh Zayed Road and its family-friendly environment make it a practical choice.
Key Considerations for NRIs
Investing in Dubai’s real estate market requires a solid understanding of the local landscape. Familiarity with key entities such as the Dubai Land Department(DLD) and the Real Estate Regulatory Authority (RERA) is essential. Whether investing in off-plan properties or the secondary market, understanding the legal and procedural aspects is critical.
For off-plan investments, ensuring that the developer has established an escrow account and that the Sale Purchase Agreement (SPA) is clear and comprehensive are important steps. Investors should also be aware of potential delays and resale conditions. In the secondary market, understanding the process of ownership transfer at the Dubai Land Department (DLD) trustee office is crucial, particularly if a Power of Attorney (POA) is not in place.
Financial Planning and Considerations
NRIs must also consider the financial implications of their investments. While mortgage rules are generally favorable—with up to 80% Loan-to-Value (LTV) available for first-time purchases—recent changes to India’s Tax Collected at Source (TCS) regulations add complexity. The 20% tax rate on remittances exceeding INR 7,00,000 under the Liberalised Remittance Scheme (LRS) requires careful financial planning.
Additionally, NRIs should factor in associated costs during the purchase process, such as the 4% Dubai Land Department fee and other transactional fees. These costs are standard but should be considered in the overall investment strategy.
The Importance of Informed Decision-Making
Dubai’s real estate market is dynamic and constantly evolving. It’s important for NRI investors to seek out reliable advice and stay informed about market trends. At MILK Real Estate, we are committed to providing our clients with the insights and guidance they need to navigate the market effectively.
In summary, while Dubai offers significant opportunities for NRI investors, success in this market requires careful planning, an understanding of local regulations, and strategic decision-making. MILK Real Estate, we’re here to support you through every step of the investment process.
Saloni Mehta Managing Director, MILK Real Estate
