Is buy-to-let shifting the Dubai property market?

10/07/2012 - Dubai Property News Posted by Neil King
Is buy-to-let shifting the Dubai property market?

Strong demand from tenants is changing how people buy property in Dubai, it has been suggested.The National reports that the sector is presenting attractive yields for buy-to-let investors, with current returns trumping even those in the landlord haven of central London.According to research by property information group Reidin, the Greens district of the emirate offers the best gross rental yields in the burgeoning Middle Eastern city.Indeed, apartments in the Emaar development are generating gross returns of 9.3 per cent, with Jumeirah Lake Towers making 8.8 per cent and Discovery Gardens garnering 8.6 per cent.However, the figures do not include the cost of service charged or maintenance fees, which do vary widely and lower the actual return investors make.The window of opportunities for landlords looking to expand their portfolio in the emirate may be narrowing, as rebounding sales prices for property in prime locations in the region limit rental returns.Head of research and consultancy at CBRE in Dubai Matthew Green was positive, however, telling the newspaper: "The returning strength of the residential market is now likely to tempt some investors back into the fray."Dubai's prime locations recorded more price increases in June, with mid-range luxury homes such as villas in the Arabian Ranches area and Victory Heights soaring by 18.5 per cent compared to the previous year, according to Cluttons' data.Apartments in Dubai glean an average return of 8.4 per cent, while villas generate some 7.2 per cent.Chief executive of Reidin Ahmet Kayhan said: "Dubai offers one of the best rental yields for residential property among peer cities across the globe."This week, Emirates 24/7 reported the most expensive property ever to be listed publically in Dubai has been advertised as on sale at a cool AED 250 million (£43.8 million), with the house boasting a coveted location on the Palm Jumeirah.The villa is currently owned by a high-profile businessman and includes no fewer than ten ensuite bedrooms, indoor and outdoor pools and a 20-seat cinema. Learn more about opportunities for property investment in Dubai at The First Group.