Purchase of rental properties in Dubai, the UAE is not only an opportunity to have a place for permanent stay or during vacations. It is also an advantageous possibility of getting passive income from renting the unit out. Buying rental real estate in the UAE for sale is the most common way to make money in Dubai. This way of increasing your capital appears highly beneficial if we take into account that 90% of the UAE population is foreigners. Constant flow of tourists and people who relocate create high demand for rental apartments and houses. In this article, we will discuss why rental housing is highly profitable in Dubai and what cons and pros of the purchase.
The right of foreigners to rent their properties out
As it is extremely difficult to get the passport of the UAE, the next question arises. Do the foreign homeowners have the right to rent their properties out? Yes, they do. Let`s find out the details.
There are two main types of rent in Dubai – short-term and long-term.
– Short-term rent is provided for less than 1 year.
It requires an appropriate license that allows you to rent out your accommodation for short periods of time. This is a so-called hotel or hotel apartment license. There are also special companies that help to rent your property out and take care about the license. Addressing such organizations, you have the percentage from rental payment and care about nothing.
– Long-term rent is provided for more than 1 year.
Long-term rent does not require any special documents. You need only a passport and a deed of ownership. There is also a common situation when owners address specialized companies and delegate them responsibilities.
Factors that influence the rental income
It is important to mention that there is no set amount of income in Dubai. Its amount depends on many factors.
– Location of property.
The location of an apartment or a house greatly influences the final income. Even housing units located in different parts of the neighborhood may bring different sums of money. However, the general rule says that the more prestigious the area, the more expensive the rental property.
– The cost of maintaining and servicing the property.
Maintaining and servicing include utility bills, possible repairs, cleaning of the whole territory, and other additional payments.
– The type of the property.
As strange as it may seem, luxury real estate provides less income than inexpensive properties. Explanations of this may be different. One of the most popular ideas is that if a person has a sound capital, they would rather buy an apartment than rent it out.
On average the net income from renting a home in Dubai is about 5-10% a year. This applies specifically to residential real estate.
Types of tenants in Dubai
There are several categories of people who rent apartments and houses in Dubai:
– businessmen and their assistants;
Pros of buying rental property in Dubai
Investing in rental real estate has a convincing number of benefits. Among the most important we can distinguish the following:
– high demand on rental units;
– permanent passive income;
– reliable and stable way to get money;
– safety of housing;
– a backup housing in case of relocation;
– absence of income tax.
Cons of buying rental property in Dubai
Disadvantages of buying rental properties in Dubai exist as well, although they are not so numerous:
– possible long pay-off period;
– change of tenants in case of short-term rent;
– risk of irresponsible tenants.
It is quite obvious from the list above that rental real estate may have some risks and cause unpleasant experiences. However, the number of advantages of owning a rental property abroad is definitely much bigger.
Source for finding real estate in Dubai
Renting properties out in Dubai brings a stable profit over a long period of time with minimal risks and financial losses. To select a suitable property that will meet all your needs, it is advisable to visit the official website Emirates.Estate. The source provides an outstanding collection of stylish apartments and houses of any segment. The properties from internationally known developers and trusted real estate agencies are represented on the website. Emirates.Estate gives a great opportunity to monitor the offers from different neighborhoods, compare the prices and quality and make a rational decision.
Foreign real estate is purchased for rental or subsequent resale. It is important to study the laws of the state where the purchase is planned. Some countries have favorable conditions for foreigners to purchase square meters, while others have stricter requirements. Ideal option is buying real estate in popular tourist areas, resort cities. Such real estate pays dividends and rarely loses value.
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