If I were to choose the ideal holiday home destination, I’d definitely go for Dubai! Now that may surprise you, especially knowing this is coming from someone who already lives in the UAE. But seriously?! Where else would you go right now? Paris? New York? Way too expensive and cold. Let alone the major factor I wouldn’t trade for anything else: safety. Yes. There is nowhere in the world safer than the UAE! In case you weren’t aware, Abu Dhabi and Dubai were ranked as the safest cities in the world – marking another milestone for the country. Not only that, but the UAE has also curtailed the pandemic, with less than 100 daily cases.
Apart from the city’s expanding international attractions, favorable business environment, new visa amendments, and massive economic initiatives for the future, we are witnessing a boom in Dubai’s real estate market. As more tourists flock to attend events and settle in the region, holiday home rentals are rising rapidly. Mind you, this trend will continue to flourish as long as UAE’s economic activity is progressing as planned. So, in this blog, I will walk you through all the influencing factors that make the Dubai holiday home market a promising one – and more importantly, serve as a great investment option right now.
Dubai ranked as the world’s 4th top city for holiday homes
According to a new study, mentioned in Khaleej Times, Abu Dhabi was also ranked as the 3rd best place for purchasing holiday homes. The report even demonstrated the difference in costs of living for a family of 4 in Abu Dhabi and Dubai being much lower than other popular cities for holiday homes like Rome, Marbella, New York, and Lisbon. Moreover, with more iconic developments taking place, like the recent ‘Ain Dubai’ and ‘Dubai Expo’, tourists will always be visiting the city to experience the various leisure activities along with the high-end amenities. Besides, Dubai’s weather is perfect for sunbathers looking for the sun all year long.
Dubai is the city for everything
If you want comfort, luxury, safety, leisure, convenience, and business all in one place, then Dubai is the place for you. One of the best perks of living in the UAE is the government’s support for always facilitating people’s needs, building a strong legal system, and an easy business structure. This has been reflected in the UAE’s successful management in times of crisis and constructive economic plans. The UAE government simply works on enhancing the quality of life for residents to eventually be the best country to live in in the future.
With the government’s visionary focus, Dubai fosters an ecosystem for futuristic business models and innovation. I mean it’s not recognized as the ‘city of the future” for no reason. Dubai also tops the list globally for foreign direct investments and for transfer in the blockchain, AI and robotics sectors. If this isn’t a sign of a promising future for the so-called ‘smart city’ in all aspects, then what would be?
Impact of pandemic on preferences
Thanks to the government’s successful strategy in combating the virus, millions of tourists came to break free from the pandemic’s stress and enjoy the city’s facilities, for it was one of the few destinations still open during the pandemic. Given the travel restrictions, residents became tourists in their own city and chose to compensate for traveling abroad by having stay-cations in the vibrant Dubai.
The increase in demand for staycations has significantly accelerated the growth of Dubai’s holiday home market. Over the last couple of months, we have witnessed a spike in short-term rentals in Dubai – performing much higher than hotels. In fact, it has become a trend nowadays to book a holiday home instead of a hotel. People want to indulge in a personal experience that offers them a sense of comfort – giving them the special feel of a home.
Advantages of holiday home investment
Apart from the stats and news circulating around the boom of the holiday home market in Dubai, there are certain advantages that always make holiday home investments a definite winner. Here’s what you need to know:
- Holiday homes generate higher rental yields
- You can increase your prices based on the season and demand
- Expo 2020 will spark the demand for holiday homes nearby to the site
- Helps offset the costs of your retirement
Limitations
Similar to typical real estate investments, identifying the right location is key for achieving good returns. Especially, when it comes to holiday homes, you need to look for areas targeted by tourists such as Downtown, Business Bay, DIFC, and Dubai Marina. So, if you don’t invest in a holiday home in a popular area, you won’t be able to sustain the costs of the unit and eventually lose. Also, holiday homes are hard to manage and regulations tend to change – due to the competition in the market and the fact that it is directly impacted by economic downturns.
The Bottom Line
Given all the progressive changes happening in the UAE, holiday homes have a strong potential to make profits for you. Nevertheless, you shouldn’t limit your portfolio to a single category of properties. It’s important you diversify your investments across the short-term and long term. smartcrowd.aeoffers you just that! In fact, due to the rising trend of short-term rentals, SmartCrowd is listing more holiday homes in the best areas of Dubai! So, make sure to register and check out our webinar on short-term vs. long-term rentals in the UAE.
