Dubai's skyline of skyscrapers and rapid growth from a desert village to a thriving metropolis has made the city synonymous with real estate. In addition, government-led reforms and initiatives have fueled a post-pandemic surge in Dubai's property market over the past six months. According to data from Dubai Land Department (DLD), the real estate market generated AED 22.7 billion in June, the highest amount in the last 13 years, and accounted for nearly 71% of the total 2021 sales volume.
His Highness, The Vice President and Prime Minister of the United Arab Emirates and Ruler of Dubai, Sheikh Mohammed bin Rashid Al Maktoum, has rolled out a wide range of new incentives for property investment funds. This comes after First Virtual Asset Regulation Law in UAE was enacted on March 11, 2022, in Dubai. As a result, investing in Dubai is likely to increase due to the new legislation intended to make Dubai an even more attractive investment destination.
LATEST GOVERNMENT REAL ESTATE REFORMS
REGISTER OF PROPERTY INVESTMENT FUNDS
The new decree applies to all real estate investment funds licensed and regulated by government authorities, private development zones, and free zones, including the DIFC.
The Dubai Land Department will establish a Register of Property Investment Funds, which will outline the terms and conditions and the procedures for listing in the Register.
The Securities and Commodities Authority and the Dubai Financial Services Authority, the DIFC's independent financial services regulator, must be consulted before a fund can be listed in the Register.
A fund's real estate assets must be worth at least AED180 million to be eligible for inclusion in the Register. At the time of application, funds should not be restricted from trading in Dubai's financial markets.
COMMITTEE FOR PROPERTY INVESTMENTS FUNDS
Under the decree, a Committee for Property Investment Funds was established to designate locations and properties where funds are authorized to invest via full ownership or lease for a period not exceeding 99 years.
Funds must invest in commercial buildings with a value of at least AED50 million, according to a directive issued by the government. The Committee must also approve any funds wanting to surrender real estate ownership.
ACCREDITED VALUATION SPECIALIST
Dubai Real Estate Regulatory Agency (RERA)-Dubai Land Department will appoint a certified valuation expert to establish the value of properties held by investment funds under the new legislation.
IN WHAT WAYS WILL INVESTORS PROFIT FROM THE DECREE'S IMPLEMENTATION?
Emirati officials hope this order will help the emirate become one of the world's most desirable real estate markets.
For Musataha contracts, an additional 50 years are possible. A renewal request must be submitted two years before the expiry date. Institutional investors will benefit from the law's increased openness.
A variety of rules and guidelines binds the person who owns the agreement. One of them is avoiding repurposing commercial property without the owner's permission.
Due to a new Dubai legislation encouraging property investment funds, the sector will likely see an influx of international investment cash soon. It will also aid smaller real estate crowdfunding and fractional ownership platforms, which are increasingly becoming popular with retail investors in real estate.
Investing in a property in Dubai may open the way to a long-term residence visa for people seeking to become residents without needing to start a company in the nation.
CONCLUSION
Real estate investment in Dubai offers several advantages. First and foremost, Dubai is a worldwide tourist destination. Entrepreneurs and investors may take advantage of the city's excellent infrastructure and unbeatable quality of life, which are all reflected in the city's rapid growth and development. Finally, people need to invest in a location they can also relocate to, and Dubai fits the bill.
For any individual or company looking to start a real estate business in Dubai, Sentinel Business Centres offers a wide range of services, including licensing, serviced workspaces, and a team ready to assist you in getting your business running as soon as possible. Contact us today to get started.
When investing in UAE, Sentinel Business Centers is one of the UAE's leading business solutions providers. For investors, workers, and dependents, our government liaison team handles all issues relating to company license and investment, including the issuance of work permits and residency permits. To learn more about our services, please get in touch with a staff member.