5 reasons why British Nationals must buy property in Dubai
This article is intended to provide the reader a clear comparison between the current scenarios in the UK and UAE, highlighting key differences in cost of living and investment opportunities. If you’re considering investing in the UAE, this guide will help you pinpoint the main advantages and make an informed decision.
- Tax-Free Environment vs. Heavy UK Taxes
Unlike the UK, where top earners face a significant 45% income tax burden on earnings above £150,000, Dubai offers a complete exemption, effectively doubling the take-home pay for those who relocate
Dubai:
One of the most significant benefits of buying property in Dubai is the tax-free environment. There is no capital gains tax, income tax, property tax, or inheritance tax. This makes Dubai an ideal destination for investors seeking to maximize their returns.
Taxation in Dubai: Investors can keep all their profits since rental income and capital gains are untaxed. This allows British property owners to enjoy higher returns than they would in most other global markets, especially compared to the UK.
UK:
In contrast, the UK has one of the highest property taxes in Europe. For instance:
Stamp Duty can range from 2% to 12% depending on the property price.
Capital Gains Tax (CGT) is up to 28% for residential properties.
Income Tax on rental income can be up to 45%. This tax burden significantly reduces investor profitability in the UK.
2.Higher Rental Yields in Dubai
Dubai:
Dubai’s property market offers some of the highest rental yields in the world, averaging around 6-8% annually, depending on the location. This is much higher than the global average and significantly surpasses what’s offered in the UK.
Example: In areas like Dubai Marina, rental yields can be as high as 8%, making it an attractive market for property investors.
UK:
In contrast, the UK’s rental yields are far lower, typically ranging from 3-5%. For example, London offers rental yields of around 3-4%, while more affordable areas like the North of England may offer slightly higher yields but not on the scale seen in Dubai.
Given the higher yield rates in Dubai, property investors can see faster returns on their investment.
3.How affordable is it to buy a house in UK vs UAE
Significant Difference in Property Prices
When it comes to purchasing property, the price disparity between London and Dubai is substantial. The average price per square metre in central London is approximately 76,000 AED while in Dubai, it’s much more affordable at around AED 24,650 (approximately £5,400). This means Dubai’s property prices are roughly 66% lower than those in London, making it a far more cost-effective investment option.
Whether you’re looking for an apartment or a villa, the price tag in London will almost certainly be much higher for comparable properties. For example, if you were to buy a 100 square metre apartment in London, you’d be looking at a price of £1.59 million. On the other hand, the same-sized apartment in Dubai would cost around £540,000, allowing you to secure a similar property in a luxurious city at a fraction of the cost. This difference means that British investors can get much more value for their money in Dubai, whether it’s a high-end apartment or a spacious villa.
4.Lower Cost of Living
Dubai
While Dubai is known for its luxury lifestyle, the cost of living is often more affordable than major cities in the UK. For example:
Groceries, utilities, and public transportation are significantly cheaper in Dubai than in London.In addition, no income tax means that you get to keep more of your earnings.Dubai also has more affordable domestic help and luxury services, making it a desirable option for high-net-worth individuals.
UK:
Cities like London have one of the highest costs of living in the world, especially when it comes to housing, transportation, and dining. For instance:
Rents in London are high, with an average rent of around £2,000 per month for a one-bedroom apartment.
The cost of utilities and transportation is also substantially higher than in Dubai, making it more expensive to maintain a comfortable lifestyle.
5.High-Quality Infrastructure and Lifestyle
Dubai:
Dubai is renowned for its luxurious lifestyle, offering world-class dining, entertainment, and shopping at prices that are often more affordable than other global cities. The city ensures an exceptional experience for people from all walks of life, with a variety of high-end options that cater to different tastes and preferences. Iconic destinations like the Dubai Mall—one of the largest shopping centers in the world—and landmarks such as the Burj Khalifa set the stage for creating a standard of luxury that’s both accessible and impressive.
UK:
While the UK offers rich cultural heritage and chilly cold winters, it is sometimes difficult to afford basic life style in the UK as people are constantly trying to make ends meet. Living lavishly or saving on a basic salary in the UK can be quite challenging, especially in major cities like London or Manchester, where the cost of living is extremely high.
If you’re considering investing in Dubai, we’ve assisted over 1,000 nationals by providing expert guidance and helping them make informed decisions. Don’t hesitate to reach out to us.
