Anvita Bhalla, 39, a former investment banker, loves Dubai. "If you are cash-rich," she says, "this is a great time to buy your dream house here."
This is not the kind of advice you would expect from someone who recently sold a Spanish-style luxury villa in Dubai's Arabian Ranches, a cluster of gated communities developed by Emaar properties, replete with an 18-hole golf course and equestrian centre.
Concerned by falling property prices, Mrs Bhalla decided to sell the villa, which she bought with her husband Rajeev five years ago when the market was booming.
Still, she is hanging on to her other Dubai investment, a three-bedroom two-storey villa in the lake area near the upmarket Emirates Hills, which is, she says, "home to Dubai's richy rich".
"Prices are down today but they will revive in the long term," says Mrs Bhalla, who moved to Dubai from New Delhi 13 years ago and currently lives in a rented property. "In that sense, property is still a great investment."
A large number of Indian property buyers such as Mrs Bhalla are investing in the Dubai market, even though house prices fell 6 per cent in the third quarter, according to Colliers International, a property services company.
In the first eight months of the year, Indian buyers accounted for almost 20 per cent of the city's entire residential property transactions, according to REIDIN.com, an information company specialising in emerging markets, citing data from the Dubai Land Department.
"Dubai's property market, after hitting its trough, has good growth potential for investors," says Sanjay Dutt, the chief executive for business development at Jones Lang LaSalle Meghraj in Mumbai.
Saurabh Sharma, a research and data manager at REIDIN.com, estimates that prices in Dubai have fallen by an average of 35 per cent since the boom in 2007. And while that may have been a factor motivating potential investors, Mr Sharma points out that the city has been an "important market" for Indians for a number of years.
"A high rental yield, zero government tax, a proximity to India in terms of physical distance are some of the factors that lure Indian buyers to Dubai," Mr Sharma says.
Variety and a competitive price range are the other factors. "Dubai caters to wallets of different sizes," says Mrs Bhalla. "And purchasing property here is a relatively hassle-free affair. By comparison, the amount of paperwork alone one needs to sign while buying property in India is frightening."
Shashi Mashruwala, the residential senior sales and leasing consultant at Better Homes, a Dubaiproperty agent, says Indian buyers are the company's main overseas clients among foreign nationals, at about 19 per cent.
"This demand is led not so much by Indians living in India but primarily by non-resident Indians based out of Dubai and other foreign destinations," says Shveta Jain, the director for residential services at the property consultant Cushman & Wakefield India.
Pinning down the status of Indian buyers can be difficult. REIDIN.comreveals only the nationality of buyers and not where they are based.
But demand is rising from the swelling ranks of the middle class in India as they become more familiar with developers based in Dubai and their aggressive advertising.
Some are investing heavily in India's booming property sector, which Merrill Lynch estimates will grow to US$90 billion (Dh330.54bn) by 2015, an almost sevenfold increase since 2005.
Emaar-MGF, a joint venture between Emaar Properties of Dubai and MGF Development of India, in 2007 won the contract to build the Commonwealth Games athletes' village for the sporting event held last month in New Delhi. Earlier this year, ETA Star Property, another Dubai developer, announced the launch of the first phase of a major project in India worth $250 million.
But investing in Dubai's property market has its share of pitfalls, experts warn.
According to Colliers International, occupancy rates in Dubai properties fell sharply in the third quarter as the market was unable to absorb the additional supply of new properties amid stagnant demand.
"Investment value is unlocked when there is a dearth of supply as opposed to demand," says Mr Dutt.
"Investment into Dubai-based properties would only begin to yield a decent rate of return when demand grows - and that is not likely to happen for quite a while."
