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Why Indian investors are flocking to Dubai

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Why Indian investors are flocking to Dubai

Dubai has always garnered hefty investments from Indians over the years. However, overall investor interest has grown radically and crossed a whopping Rs.42,000 crore within the last 18 months as per reports from the Dubai Land Department. This is close to 40% more than the quantum of investments witnessed in the year 2014. Indians can take pride in the fact that they are Dubai’s biggest foreign investors in recent years. Indian investors seek to gather returns between 8-10% which are tax free on real estate properties. This ensures higher appreciation of capital and better returns in comparison to several cities in India.

An Indian investor can pump in a maximum of $250,000 per annum in Dubai which effectively means that $500,000 can be invested over a period of two years for purchasing a good property here. There are frequent flights to Dubai and the distance between the two cities is also pretty short. The Dubai realty market is transparent and this makes it a good bet for investors from India. Dubai requires lower investments as compared to buying properties in prime locations in Delhi, Mumbai and other Tier 1 cities. According to reports, approximately Rs.25,000 per sq. ft. can be charged per sq. ft. for locations in Central Dubai. This is way lower than the investments required to buy a property in Central Mumbai or Delhi for example.

With good returns being delivered by the stock markets in India, investors are booking their profits and speedily deploying the returns into other asset classes which promise higher returns. Real estate is one of the preferred asset classes and is a favourite for many investors, particularly in Dubai and also in India. Indian investors have also faced problems like construction delays, lack of exit-based alternatives and high ticket sizes over the last ten years in the domestic real estate industry. As a result, investing in Dubai may be a viable option for many of them at present. Experts forecast a growing trend when it comes to real estate investments in Dubai as far as Indians are concerned, unless there are procedural, infrastructural and regulatory changes in the country’s own realty arena.

 

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