Contrary to popular belief, the UAE allows foreign nationals to own property in designated freehold areas in Dubai. In the United Arab Emirates, there are two types of property ownership for foreigners: leasehold and freehold.

Leasehold is the right of long-term lease. It is the kind of ownership that tends to be brought up in the myth mentioned above. Indeed, if you buy a property in a leasehold, you get ownership for a fixed time period, which is no more than 99 years. At the end of the leasehold, ownership reverts to the original owner. 

Leaseholds can be renewed, but this involves many restrictions: even simple repairs will require the owner's permission. Moreover, if you buy such a property on the secondary market from another foreigner who acquired it, for example, 20 years ago, you will own the property for 79 years. Today, this type of real estate is quite rare.

Freehold is full private ownership, including the land where the property is built. The Dubai Land Department (DLD) puts the buyer on the register as the owner and issues a title deed to the property. Such properties can be sold, leased, and bequeathed. There is no time limit on ownership.

Today, foreigners have access to dozens of freehold areas in the most attractive locations in the UAE. Major parts of New Dubai, including the iconic Dubai Marina, Palm Jumeirah, Jumeirah Lakes Towers, Downtown Dubai, and Business Bay, have freehold status. It is impossible to name the exact number of such zones, as they are constantly growing. Currently, there are about 80 freehold districts and communities in Dubai.

Perhaps this is the biggest misconception people have about property investing in general, let alone Dubai property investing. Luckily, nowadays, real estate is no longer reserved for the rich. With reputable real estate crowdfunding platforms in MENA such as smartcrowd.ae, people have direct access to real estate by owning property shares in Dubai’s best properties starting from just AED 500. This means, that there is no need to acquire high capital upfront to invest in any property. No more excuses.

You could either opt for fractional property investments in Dubai or invest entirely on your own. If you prefer the latter, you can simply apply for a home loan to help you finance it. Most banks in the UAE offer various favorable payment plans, depending on your financial capabilities – Which brings us to another myth we shall discuss below.

UAE banks provide mortgages to non-residents, but on less favorable terms than for residents. The down payment will be 50% compared to 20% for residents, the interest rate may also be higher. On average, it ranges from 3 to 6.5% per annum in the country.

You cannot possibly time the market, even the biggest real estate tycoons cannot do so perfectly. In fact, timing the market is quite tricky and involves a wide range of factors that are complicated for the regular individual to track. A simple piece of advice is to follow a strategic plan that suits your goals and try investing as early as you can. This is how most successful investors make it. Just start with small amounts, regardless of how trivial you might think it is. With time, and as you re-invest those small earnings, you will eventually end up with a significant amount thanks to compounding.

Despite going through turbulent times in the previous years, Dubai’s real estate market is classified as an undervalued market, according to UBS Global Real Estate Bubble Index. Thanks to the new government initiatives, visa amendments, expo 2020 underway, and a successful vaccination drive, more foreign investors are flocking to settle in the region. As a result, the rise in real estate transactions is expected to remain for a prolonged period. In fact, there is currently a limited supply, especially for studios which is the most demanded investment option, especially on our platform. Overall, Dubai’s property market is growing with more developments on the way. Regardless, one cannot generalize, in case there was an actual oversaturation happening, for every community performs differently. Some areas generate higher net yields and are more demanded while others don’t reflect similar results.

 Dubai's real estate market has indeed witnessed significant price fluctuations over the years. While certain periods experienced remarkable growth, such as in the early 2000s, it's essential to understand that the market operates in cycles. Property prices can rise and fall based on various factors, including economic conditions, market demand, and global events. Investors should exercise caution and adopt a long-term approach rather than banking on quick gains.

Novice investors believe that the only profitable investment property is in central or coastal areas. Professional brokers would disagree with that statement.

“If you’re making an investment, it’s worth buying property in an area that’s currently developing. Prices for such properties are lower, and they will rise at a higher rate. Consequently, for investments, such an option will be more profitable,” says Aram Grigoryan.

In particular, the cost of housing increases when the metro line is built or infrastructure appears in the area. This is a stable trend observed in the emirate. In addition, in accordance with the master plan of Dubai development, by 2040 there will be two new centers in the city. In the early stages, real estate there will be much more profitable than in already completed coastal areas, and you will be able to invest in the location, which will soon become the new Dubai Marina.

Another myth is that the procedure for buying property in Dubai is long and difficult. It is not. The process is very simple and transparent. To buy a property, you only need a bank card to pay the deposit and a copy of your passport, which can be sent to an agent or a developer’s representative. The transaction in the secondary market is a more different process, but everything can be easily solved by contacting an experienced broker.

Off-plan properties, those purchased before completion, often face skepticism due to past market fluctuations. However, it's crucial to recognize that many developers in Dubai are reputable and deliver projects on time and as promised. Off-plan investments can offer attractive prices and flexible payment plans, making them an enticing option for buyers. It's essential to research the developer's track record and review the project's details carefully before making any investment decisions.

 As with any real estate market, success in Dubai requires patience, research, and careful planning. While the city has witnessed impressive growth in the past, it's crucial to understand that real estate investments should align with long-term financial goals. Short-term speculative investments carry inherent risks and may not always yield the expected returns.

The real estate market in Dubai is undeniably alluring, but it's essential to navigate it armed with accurate information rather than succumbing to common myths. By dispelling these ten misconceptions, potential investors and homeowners can approach the Dubai market with a clearer perspective, making well-informed decisions that suit their needs and aspirations. Remember, real estate investment is a journey, and arming yourself with knowledge is the key to success.