| The Dubai Expo of 2020 is going to be a major milestone. It is going to be the transformation of Dubai for an oil-centric country to a country that is now knowledge-centric, as the theme ‘Connecting Minds, Creating the Future’ suggests. Of course, tourism is likely to see a huge rise in 2020, which will definitely boost the tourism industry. Also, the property market in Dubai is quite likely to see a boom in 2020. As per a report by E&Y, the Dubai Expo will introduce AED62.2 billion GVA to the Dubai economy. Out of this gross total, around AED27 billion is expected to come from construction.
In 2020, the UAE government is planning to introduce tokenization in the real estate market. Tokenization is basically a cryptocurrency fundraiser, which means that investors can exchange cryptocurrency for tokens to buy real estate which will help securitize an asset. In a nutshell, to securitize an asset is to divide the asset into shares which is then sold to the investors. This idea of tokenization is expected to increase the amount of foreign investment in Dubai which will most likely lead to price-stabilization. Again, price-stabilization means a stable economy which has a very low rate of inflation or deflation, which is obviously beneficial for every economy and hence every sector and industry in that economy. Abundance of new developments In 2019, 59,800 new properties were expected to be built in Dubai. Not only about half of these properties were actually introduced. However, in 2020, it is expected that a whopping 46,000 units are to be introduced after July. That means there will be a pretty good balance between the supply in terms of ready-to-sell properties and demand i.e. real estate investors. The Dubai Expo of 2020 will probably also see a rise in the sale of off-plan properties in Dubai. The Golden Card The UAE has also launched a new initiative, the “Golden Card” residency permits. This residency permit basically aims at attracting wealthy investors and extraordinary talents like doctors, scientists, engineers, artists and even exceptional students to set up base in Dubai and live permanently. When this scheme was initially launched in May, people from over 70 countries invested over USD 27 billion and were given permanent residency. With the combination of the “Golden Card” residency scheme and well as the Dubai Expo 2020, there will obviously be a pretty large increase in the number of people who are going to buy property in UAE.
The creation of District 2020 Another big thing to look out for is District 2020 which is going to be the central hosting ground for the Dubai Expo. District 2020 will open in October 2020 just to host the expo, after which it will be completely renovated and open exactly one year later as a community. This community will have 700,000 square feet of purely residential space – which is obviously a great catch for investors. Plus, this community will have green spaces and educational facilities. This will be another investment opportunity. Increase in the demand for rental properties It is predicted that there will be over 25 million visitors for the Dubai Expo, out of which around 70 per cent will be non-resident visitors. Considering that the Dubai Expo 2020 will be held from 20 October 2020 and 10 April 2021, we can assume that a large number of these visitors are going to take places on rent. The landlords are definitely going to see a steady rental income and possibly a strong rental market too, not only for this duration of a few months but even in the long-term. Plus, with the development of the new metro line which is going to connect the corners and suburbs of Dubai, people will not think twice about the location of their property. That means, it is highly possible that the rental prices will rise in the areas where this new metro line is being developed. However, an increase in demand for rental properties is just one aspect of the real estate market post the Dubai Expo of 2020. Conclusion Obviously, it is predicted that the prices in Dubai are going to rise after the expo, but no one can say for sure. With the number of new properties that will be available on the market coupled with the golden card residency permits, we can assume that the demand is going to meet the supply, if not be much higher. But then again, the property market is not as simple as the basics of economics. While it might seem that the demand and supply will go hand in hand, the reality of the situation will only unfold when the time comes. However, as time passes, the future of the UAE is expected to see a pretty significant growth, be it in terms of the economy as a whole or just the real estate market. |
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