Dubai: The falling value of the Indian Rupee will affect the number of Indian investors in the Dubai realty market, according to experts.
“The Indian investment in Dubai real estate market will experience a decline, but it won’t have a major impact on an opportunity-rich market like Dubai.”
Indian capital isn’t likely to go back to India to take advantage of the currency’s depreciation. Indians are among the top investors in Dubai’s real estate market, and that is expected to remain the case.
“In the short term investors will not take the risk and direct their investments to India as the rupee could regain its value soon,” he said. “But there is no clue what is going to happen in the long term.”
Dubai is an international real estate market, new investors would fill the gap left by any Indians taking their money home.
Foreign investors contributed up to 32 per cent of the total investments with an increase of 73 per cent from the same period last year, according to the latest statistics issued by Dubai’s Land Department. The emirate’s real estate market attracted investments worth Dh53 billion during the first half 2013, a 49 per cent year-on-year increase.
As per Land Department’s estimates, Indian investors have contributed to the bulk of foreign investments in Dubai’s real estate market. The Indian transactions were worth Dh8 billion during the first half of this year. Indians were closely followed by investors from the UK and Pakistan whose investments were worth Dh4 billion and Dh3 billion respectively.
Indians who are able to invest in Dubai realty market will not only be hesitant to go ahead but will be facing a lot of obstacles. As Indian governments have put tough restrictions to control money transfer from India, investment in Dubai market or any other market will be not only difficult but too costly.
“Despite the fact that Dubai is the most favourable and advantageous destination for Indian investments, there will be changes as the return of this business will not cover the rupee value depreciation in the short term” .
Change will be very limited as “Some will be cautious at this stage and there will be marginal drop in property buyers. Not all investors are based in India, most of them come from different destinations”.
However, not everyone believes the rupee’s drop will slow down Indian transactions in the Dubai realty market.
“Indians will spend more to invest in the Dubai real estate market, as they have very limited alternatives in the Gulf region.”
Far from the currency drop, serious Indian investors will not find better opportunity in the real estate sector than Dubai.
The advantages of a free-tax market in Dubai will bring these investors good compensation from the currency’s depreciation. “Dubai’s real estate market is a lucrative one with stability, diversity and promise of high return on investment”.