Dubai ranks third among 23 major global cities for home-purchase affordability relative to income, after Toronto and Miami according to UBS Global Real Estate Index
Dubai’s position among the world’s most accessible major cities for residential property ownership reflects the increasing maturity and competitiveness of its real estate market and strengthens its appeal to both end-users and long-term investors, according to Arabian Gulf Properties.
The assessment follows findings from the UBS Global Real Estate Index, which ranked Dubai third among 23 major global cities in terms of the affordability of purchasing a home relative to income levels, after Toronto and Miami.
According to the index, a skilled service-sector employee earning an average income in Dubai would require approximately five years of income to purchase a 60-square-metre apartment near the city centre. This compares with around 15 years in Hong Kong and 11 years in London, while the figure exceeds 10 years in several other major international cities.
Badar Rashid AlBlooshi, Chairman of Arabian Gulf Properties, said the findings underline an important competitive advantage for Dubai as the emirate continues to consolidate its position as a leading global destination for living, investment and business.
“Dubai’s real estate market has achieved significant growth in recent years, but what is equally important is that the fundamentals continue to support ownership,” said AlBlooshi. “The ability to access quality residential property at comparatively competitive levels, while benefiting from a world-class urban environment and a strong rental market, gives Dubai an important advantage over many established international cities.”
He added: “For buyers, affordability should not be viewed only through the headline price of a property. The relationship between purchase values, rental levels, income and long-term demand is equally important. Dubai continues to demonstrate strength across these fundamentals, which supports confidence in the sustainability of the market.”
The UBS findings also placed Dubai second globally, after São Paulo, among the cities with the lowest price-to-rent ratios. In Dubai, the purchase price of a property is equivalent to approximately 16 years of rental income, compared with 46 years in Zurich, 40 years in Geneva and more than 30 years in several other major cities.
Arabian Gulf Properties said this relationship between property values and rental income is particularly relevant for investors, as it provides an indication of how closely purchase prices remain connected to the income-generating potential of residential assets.
AlBlooshi said: “A healthy residential market needs to work for both the person buying a home to live in and the investor looking for sustainable returns. Dubai’s relatively favourable relationship between property prices and rents helps create that balance.”
He added that the evolution of buyer behaviour in Dubai is also contributing to a more mature market, with demand increasingly driven by residents establishing longer-term roots in the emirate alongside international investors seeking exposure to the city’s continued economic and population growth.
The UBS analysis also found that the estimated economic cost of owning a home in Dubai is lower than the cost of renting a comparable property when factors including financing costs, capital costs, maintenance, depreciation and expected property appreciation are taken into consideration.
According to Arabian Gulf Properties, this further strengthens the proposition for buyers considering a transition from renting to ownership, particularly as Dubai continues to expand its residential communities and diversify the range of housing available across different market segments.
“Dubai continues to attract capital and residents from around the world, but sustainable growth ultimately depends on maintaining a market where property ownership continues to make economic sense,” AlBlooshi concluded. “The latest international comparison is another indication that Dubai remains strongly positioned on that front.” – ENDS –
About Arabian Gulf Properties
Arabian Gulf Properties (AGP) is a Dubai-based integrated real-estate developer with vast experience in delivering residential and mixed-use projects that combine design excellence, livability and investment value. Guided by innovation and craftsmanship, AGP continues to play a leading role in shaping Dubai’s modern urban landscape in alignment with the emirate’s long-term economic vision.
Source: Zawya
