Millennial buyers are choosing to invest in property in Dubai with the firm belief that the long-term benefits of wealth creation will cover any possible risks. These are buyers between the ages of 25-37 and they are steadily coming into the Dubai real estate market on account of factors like lower housing prices and more convenient schemes for repayment. Several millennials chose to rent earlier in Dubai than purchase their own properties on account of the high entry barriers prevalent in the UAE realty market. However, a majority of buyers are those who are professionally settled and mostly have working spouses.
However, affordability is still a little hurdle, specially the deposit needed to buy a home and other fees that have to be paid. 32% of the value of the property has to be arranged by the homebuyer. Also, several youngsters have desires related to buying vehicles, traveling, purchasing other items and living a premium lifestyle. These are aspects which often keep millennials away from property purchases in Dubai. However, things are changing steadily with more developers looking at millennials as a serious home-buying group. These buyers usually have lower budgets ranging between Dh1-3 million on an average. Expats between 27-35 are now viewing real estate as a great investment in Dubai.
Most millennials are living in their own properties although some still lease them out to earn a steady income. However, most millennial buyers coming into the market are those who want to first secure their own home prior to looking at investing in more properties. In case people wish to settle down in Dubai for several years and set up their family here, it will obviously be more sensible to build one’s own asset and repay the mortgage instead of renting for high amounts every month. This group of buyers often has the required cash saved up for making the deposit and once this is possible, the mortgage payments could even be lower than rentals in many cases.
Buyers who are in their 20s usually choose apartments while those in their 30s also look at villa projects. Smaller families who have budgetary restrictions often choose 1 or 2 bedroom apartments. Millennials also prefer locations which have good amenities like gyms, supermarkets and connectivity to highways. Millennials usually desire contemporary home designs with floor-to-ceiling windows and chrome fittings. Some of the desirable locations for millennial buyers include The Greens, Dubai Marina and Jumeirah Lakes Towers. Buyers also prefer locations where their millennial friends and colleagues are investing in. The developer’s brand value and track record is also assessed carefully prior to buying.
Most millennial buyers usually opt for lower property prices and special payment schemes and offers along with waivers on fees. Developers are also offering flexible deposit payments and other convenient payment plans in a bid to attract more buyers in tandem with free service fees for up to 3 years, discounts on the DLD (Dubai land Department) fees, interest-free bank payments up to 5 years and full payment up to 5 years post-handover among other incentives.