The History of Real Estate in Dubai Research Paper

The History of Real Estate in Dubai - Research Paper Example There are close to 2, 50,000 employees who are mostly south Asian working in real estate projects across Dubai. (Dubai History. n.d) In 1990, under Sheikh Mohammed governance, some very interesting real estate projects were designed and executed like the seven star Burj Al Arab Hotel which became the tallest free standing building in the world. The emirates towers became the tallest commercial building in Asia, Europe and Middle East. During the same time, other notable buildings, world class ideas, mega projects were designed and executed to make a mark in the international arena. Sheikh Mohammed wanted Dubai to be the hub and the location for international investment. The rentals and the return on investment far exceeded the expectation with greater benefits. Sheikh Mohammed also helped in promoting the development of real estate through Emaar properties which is the largest real estate company in Dubai. (Cooper, 2004) One of the turning points in the history of Dubai real estate w as on May 2002 when the government had declared freehold property on land. It was also during this period that the government had also familiarized foreigners to buy freehold property. Prior to this, only UAE nationals were allowed to buy and own property in Dubai which was only on a 99 year lease and this was not very popular with the public. It was only after the adoption of the freehold property and foreign investment that the real estate in Dubai had a boom in the residential property. Dubai then became a city which was built on good ethical practice, foreign investment and good projects. (Cooper, 2004) Foreign Investment in Dubai Real Estate Sector Until 2002, the UAE law had strict rules and policies and did not allow expatriates from owning any property. They were allowed only to rent property or own the property on a lease period approved by the federal law. It was only during this year that the Dubai government had permitted the expats to buy and sell property and this revo lutionized the real estate sector. This decision was taken after understanding that the petrol and the oil reserves which form the main economy booster might perish in 10 years. One of the main strategies of the government was to improve the service sector and the local real estate market in Dubai. (Foreign Investment in Dubai, n.d) The demand for both commercial and residential property market increased rapidly because of the change in government policy. The expatriates from non GCC countries were also allowed to hold properties in the country and this was regarded as a great leap in Dubai as this was not imposed in any other emirate country. There was a sudden increase in foreign investment especially from UK and Europe in the Dubai real estate market. (9) In the recent years the city has been a constant attraction for expat investors. The real estate market in Dubai is largely driven by foreign investment especially the non- Arab companies and individuals, their freehold investme nts total around 60-70% of the entire real estate market. Statistics state that every 3rd property is held by expatiates or foreign companies who live outside Dubai. The portfolios of the investors range from Pakistan, India and other emerging markets such as S. Korea and Brazil. (Foreign Investments Spurs Dubai Real Estate Growth, n.d) Iran is one of the leading and the major partners for Dubai and forms at least 30% of the total business done in Dubai. The