Overseas real estate is becoming a popular choice among UAE-based investors. According to data from CBRE Group, UAE ranked 12th on global rankings with a total of $6.64 billion spent on global assets during 2014 and first half of 2015. Among other Middle East countries who made it to the list was Qatar ranked 8th and Saudi Arabia ranked 21st. Below we look at top overseas destinations for UAE investors and funding options.
Top property markets
London continues to be the market of choice for UAE residents with 21 percent preferring to invest there, according to the IP Global report. Traditionally, it’s been seen as a stable and safe market for investors throughout the Middle East region, especially GCC nationals. The British capital has shown strong price growth across its real estate market segments, with no signs of demand slowing down as its population is expected to grow to 11 million from 8.6 million by 2030.
[Related: Investing in UK property]
New York and Sydney come second behind London with 13 percent of property investment from UAE buyers, followed by Melbourne at 8 percent.
However, UAE investors are increasingly looking for more affordable options in locations across the UK. A Find UK Property survey released this year shows that buyers from UAE now account for over 18% of such property sales to overseas investors. A large percentage of these buyers are said to be British expats living in the UAE, many of whom have already invested in UAE property.
India is another popular option that has seen continued demand among non-resident Indians (NRIs) despite an increase in prices. A poll by Sumansa Exhibitions of 15,000 NRIs living in the UAE in May revealed that 72 percent of those buyers will plan to buy property in their home country this year. Mumbai and Bangalore were identified as preferred locations.
You can compare home loans available in the UAE and find the one that suits all your requirements
Buying process and funding options
Once you’ve decided which country to invest in, the next step is to select a property. Make sure your purpose and financial goal is in line with your investment strategy. There are various reasons for buying property overseas – investing for a high rental return or capital appreciation, buying a holiday home or getting your retirement home ready.
After that comes the research. Since you’re most likely to buy through a broker, you could consider taking your business to an established international brokerage, preferably one which has a branch here in the UAE. But don’t leave the search solely to your broker, be sure to do your own research and stay abreast of the prices and other key trends in your desired property market.
[Related: Mortgage brokers – are they worth it]
If you’re going to be buying with a mortgage, selecting the right mortgage provider will be final step in sealing a good deal. Buying a property in the UK and parts of Europe can be complicated. You will likely need to manage mortgage repayments in different currencies and hire lawyers or solicitors to manage the property transaction process. There are a handful of banks and mortgage providers here in the UAE who manage UK purchases from Dubai, eliminating the need to travel to complete this process. Home Matters offers UAE investors (including those who are non-UK passport holders) up to 75 percent on buy-to-let mortgages with lending rates starting at around 3 percent. For investors buying a holiday home in the UK, finance is available up to 90% with rates starting from 1.99%.
Another example is that of HSBC also offers financing and property consulting services tailored specifically for UK expats living abroad. The bank provides its expat customers with a range of mortgages for buy-to-let as well as residential properties in the UAE at attractive interest rates, according to the bank’s website.
Standard Chartered Bank offers NRIs in the UAE home loans with rates starting at 10.10% per year that finance up to 80 percent of a property’s value. According to the bank, home loans are available for properties in the following locations: Delhi, Gurgaon, Noida , Kolkata, Mumbai, Pune, Bangalore, Chennai, Hyderabad, Ahmedabad, Surat, Coimbatore , Chandigarh and Jaipur.