How the UAE's coronavirus response is driving Indians to buy property in Dubai

The UAE real estate market is witnessing a surge in demand for villas, townhouses and larger apartments from expat Indians, as the well off among the diaspora seek to move out of crammed rented accommodations to spacious homes amid a flurry of favourable government policy initiatives

According to Shajai Jacob, CEO-GCC, Anarock Property Consultants, record low property prices and the efficiency of the UAE healthcare infrastructure in containing the Covid pandemic has also been attracting domestic cash-rich Indians and upwardly mobile professionals to invest in residential properties in UAE in added numbers this year.

“Expat Indians who were living on rent have recognised the need for added flexibility of space in their residence, leading to a demand push for the mid-to-high end of residential properties in the recent months,” Jacob told Arabian Business.

“As the pandemic started, the secondary markets performed extremely well because of the distress deals being available. However, in Q2 and Q3, the primary segment has also caught up and off plan sales – sales in under construction projects – are almost back to pre-Covid levels now.

“With property rates at record lows, there has been considerable demand for larger apartments, townhouses and villas,” Jacob said.

Jacob said the UAE government has been proactive in reacting to the slowdown caused by Covid-19.

“While the recent measures introduced by the UAE authorities were aimed at encouraging investments into the UAE, measures such as long-term visas and ‘Retire in UAE’ schemes have specific clauses which take into account real estate investments made by individuals.”

Shajai Jacob, CEO-GCC, Anarock Property Consultants

Jacob also pointed out that while Indians have always shown confidence in the real estate market in UAE – they topped the list of nationalities buying properties in Dubai in 2019, according to a recent Dubai Land Department report – primarily because of the safety of their investments, the pandemic has altered the drivers of such investment decisions.

“The consumer sentiment this time has been boosted by the exemplary efforts of the UAE government in healthcare services to deal with this pandemic and the policy measures have definitely contributed to the recovery of the sector in quick time,” he said.

“At a time like this, we feel this is going to be the major driver for a lot of property investments by Indians in the UAE.”

By contrast, as well as having the second highest number of cases and third highest number of deaths, India has suffered a huge economic hit from Covid-19.

According to Jacob, besides the record low costs, low interest rates as compared to India, strong rental yields and currency rate benefits are added factors for Indians to invest in Dubai and the larger UAE real estate market.

Indians topped the list of nationalities buying properties in Dubai in 2019, according to a recent Dubai Land Department report

Besides Dubai, the UK has been another major destination for NRI (non-resident Indian) investments in properties – by both expat and resident Indians.

The UK government has helped strong buyer interest in recent months with some proactive measures including time bound relief on stamp duty.

Jacob, however, said with Dubai prime property rates still being one of the lowest compared to other global destinations like London, New York and Singapore, the volume and quantum of investments by NRIs in the UAE will continue to be far more than that in any other overseas market.