Dubai’s success in handling the Covid-19 pandemic and its proactive policy measures to jump-start the economy have driven demand for property, pushing capital values for prime homes higher in the emirate.
Residential capital values grew 4.2 per cent in the first half of 2021 on availability of good quality stock, affordable prices and strong transaction activity, according to a report by global property consultancy Savills.
“The return of international travel is likely to provide an increased supply of buyers for prime properties,” said Swapnil Pillai, associate director of research at Savills Middle East.
“The economic recovery and growth, led by [an] increasing vaccination rate in the UAE, is expected to further support buyer confidence and boost demand. Though a degree of pandemic-related uncertainty remains, the prime residential sector is likely to remain strong through the rest of the year.”
Despite the ongoing uncertainty caused by the pandemic, 30 property markets in the Savills global index held up well as capital values grew on average by 3.9 per cent over the six-month period, the fastest growth rate since December 2016, according to the consultancy.
Dubai, the commercial and travel centre of the Middle East, was ranked 11th in terms of capital appreciation, with Shanghai topping the charts, followed by another Chinese city, Hangzhou. The US cities of Los Angeles and Miami occupied third and fourth spots, respectively.
Moscow, Seoul and Lisbon were also included in the top-10 global markets that have registered considerable capital appreciation in the first half, according to the report.
“With offices closed and the work-from-home concept in full bloom, the resulting increased need for space helped to push up capital values in locations including Dubai, Cape Town, Moscow and Lisbon,” Savills said.
“Alongside that, transaction volumes are going up in comparison with the first half of 2020 when a lot of cities where in complete lockdown.”
The UAE property market – which softened due to a three-year oil price slump that began in 2014, oversupply concerns and the pandemic – is bouncing back strongly.
People upgrading to larger homes with outdoor amenities have driven demand amid a rise in remote working and learning.
Economic support measures and government initiatives – such as residency permits for retirees and remote workers and the expansion of the 10-year golden visa programme – have also helped to improve investor sentiment.
Dubai’s prime residential market recorded a 43.8 per cent surge in sales volume in the second quarter of 2021, compared with the previous quarter, according to Luxhabitat Sotheby’s International Realty report, which cited Dubai Land Department data.
Total sales during the period included 4,681 apartments and 818 villas valued at Dh16.7 billion ($4.54bn).
Overall property prices in Dubai rose 15 per cent in July alone, with average price in the emirate climbing to Dh941 per square foot ($256), from Dh818 per square foot in the same period last year, Property Monitor said.
Prices rose 1.9 per cent month-on-month in July and have climbed 11.8 per cent this year, mirroring the global trend as the world recovers from the pandemic-driven slowdown, according to its monthly market report.
Ten tax points to be aware of in 2026
1. Domestic VAT refund amendments: request your refund within five years
If a business does not apply for the refund on time, they lose their credit.
2. E-invoicing in the UAE
Businesses should continue preparing for the implementation of e-invoicing in the UAE, with 2026 a preparation and transition period ahead of phased mandatory adoption.
3. More tax audits
Tax authorities are increasingly using data already available across multiple filings to identify audit risks.
4. More beneficial VAT and excise tax penalty regime
Tax disputes are expected to become more frequent and more structured, with clearer administrative objection and appeal processes. The UAE has adopted a new penalty regime for VAT and excise disputes, which now mirrors the penalty regime for corporate tax.
5. Greater emphasis on statutory audit
There is a greater need for the accuracy of financial statements. The International Financial Reporting Standards standards need to be strictly adhered to and, as a result, the quality of the audits will need to increase.
6. Further transfer pricing enforcement
Transfer pricing enforcement, which refers to the practice of establishing prices for internal transactions between related entities, is expected to broaden in scope. The UAE will shortly open the possibility to negotiate advance pricing agreements, or essentially rulings for transfer pricing purposes.
7. Limited time periods for audits
Recent amendments also introduce a default five-year limitation period for tax audits and assessments, subject to specific statutory exceptions. While the standard audit and assessment period is five years, this may be extended to up to 15 years in cases involving fraud or tax evasion.
8. Pillar 2 implementation
Many multinational groups will begin to feel the practical effect of the Domestic Minimum Top-Up Tax (DMTT), the UAE's implementation of the OECD’s global minimum tax under Pillar 2. While the rules apply for financial years starting on or after January 1, 2025, it is 2026 that marks the transition to an operational phase.
9. Reduced compliance obligations for imported goods and services
Businesses that apply the reverse-charge mechanism for VAT purposes in the UAE may benefit from reduced compliance obligations.
10. Substance and CbC reporting focus
Tax authorities are expected to continue strengthening the enforcement of economic substance and Country-by-Country (CbC) reporting frameworks. In the UAE, these regimes are increasingly being used as risk-assessment tools, providing tax authorities with a comprehensive view of multinational groups’ global footprints and enabling them to assess whether profits are aligned with real economic activity.
Contributed by Thomas Vanhee and Hend Rashwan, Aurifer
Tips for job-seekers
- Do not submit your application through the Easy Apply button on LinkedIn. Employers receive between 600 and 800 replies for each job advert on the platform. If you are the right fit for a job, connect to a relevant person in the company on LinkedIn and send them a direct message.
- Make sure you are an exact fit for the job advertised. If you are an HR manager with five years’ experience in retail and the job requires a similar candidate with five years’ experience in consumer, you should apply. But if you have no experience in HR, do not apply for the job.
David Mackenzie, founder of recruitment agency Mackenzie Jones Middle East
Desert Warrior
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Director: Rupert Wyatt
Rating: 3/5
Company Fact Box
Company name/date started: Abwaab Technologies / September 2019
Founders: Hamdi Tabbaa, co-founder and CEO. Hussein Alsarabi, co-founder and CTO
Based: Amman, Jordan
Sector: Education Technology
Size (employees/revenue): Total team size: 65. Full-time employees: 25. Revenue undisclosed
Stage: early-stage startup
Investors: Adam Tech Ventures, Endure Capital, Equitrust, the World Bank-backed Innovative Startups SMEs Fund, a London investment fund, a number of former and current executives from Uber and Netflix, among others.
Itcan profile
Founders: Mansour Althani and Abdullah Althani
Based: Business Bay, with offices in Saudi Arabia, Egypt and India
Sector: Technology, digital marketing and e-commerce
Size: 70 employees
Revenue: On track to make Dh100 million in revenue this year since its 2015 launch
Funding: Self-funded to date
The specs: 2018 Audi RS5
Price, base: Dh359,200
Engine: 2.9L twin-turbo V6
Transmission: Eight-speed automatic
Power: 450hp at 5,700rpm
Torque: 600Nm at 1,900rpm
Fuel economy, combined: 8.7L / 100km
