By: Nombasa Mawela
South African property buyers are cashing in on the Dubai property boom. During a recent whirlwind visit to Durban, Seeff’s Dubai Office secured several sales and notable interest from South African property investors over the two-day visit.
I was overwhelmed by the interest shown by South Africans to invest in the booming property market. Buyers were mostly entrepreneurs from various industries, as well as experienced and upcoming property investors.
The sales were predominantly luxury flats, priced upwards of R10 million bought off-plan. The real attraction is the flexible interest-free payment plans offered over 5 to 7 years by the developers rather than the buyers needing to mortgage the properties, which would attract interest.
The properties were all purchased for investment purposes. The market growth graphs projecting impressive return on investments over the past few months were a definite motivation. It showed a massive growth of almost 50% from 2022 in property prices, which has created investment confidence, she says further.
The confidence is not misplaced. According to recent media reports in Bloomberg and the Financial Times, the Dubai property market continues its booming pace, with property values continuing to rise at a record pace amid strong demand. They report that many of the world’s richest individuals are turning to Dubai as a financial haven.
Further, the off-plan developments are particularly well suited to the South African market. This is due to their flexible payment plans and higher possibilities of being reinvested in the market. The sales were two-bedroomed units selling for AED 2.88 million (about R14 million).
The properties were purchased for investment purposes to capitalise on the strong short-term rental market, mostly through Airbnb and Bookings.Com, as well as the rising demand for long-term residential rentals in the city of Dubai.
The various visas that come with property investment, particularly the golden visa, have also become a popular attraction for investment in property. The reality of being able to have a standing visa for up to 10 years and the ability to host your family has attracted even more potential investors.
Another drawcard for the buyers is the ability to open an offshore personal and business bank account in Dubai. Our buyers for the roadshow included young entrepreneurs, and upcoming and experienced property investors in South Africa who wish to diversify their portfolios, but we expect those looking for economic opportunities in Dubai will also be drawn to investing in property.
It is also relatively easy and straightforward to purchase property, especially the off-plan developments and there are many of these available, offering various properties from apartments to luxury villas. Assistance is provided every step of the way for buyers and investors.
* Nombasa Mawela is a licensee for Seeff Dubai