Why Dubai is getting too crowded for comfort

Dubai's foreigner-friendly property laws, along with promises of high rental income - are attractive. But does supply threaten to outstrip demand?

Clare Aggarwal is a "professional landlord and investor", according to The Mail on Sunday. Her latest purchase was a £174,000 two-bedroom flat in Dubai "my first venture abroad". The flat doesn't actually exist yet it's just one of 504 apartments being built in The Torch, a 74-storey building on Dubai Marina, and is due for completion in March 2008. Nonetheless, according to Aggarwal, Dubai's increasingly foreigner-friendly property laws foreigners can buy freeholds, although only in special zones have "added another 15% to the apartment's value and it will hopefully have doubled when it's all done and dusted". "I am told the rental income is between 12% and 15% per annum," she says.

Readers who are on the ball may be starting to wonder a little how can someone be so sure of rental income for a flat that won't actually be inhabitable until more than a year from now? Perhaps they won't then be surprised to learn about how Ms Aggarwal found the property "I saw an advert in the paper, looked into it and put my money down". She has, of course, actually been to Dubai, "on family holidays six or seven times".

Subscribe to MoneyWeek

Subscribe to MoneyWeek today and get your first six magazine issues absolutely FREE

Get 6 issues free
https://cdn.mos.cms.futurecdn.net/flexiimages/mw70aro6gl1676370748.jpg

Sign up to Money Morning

Don't miss the latest investment and personal finances news, market analysis, plus money-saving tips with our free twice-daily newsletter

Don't miss the latest investment and personal finances news, market analysis, plus money-saving tips with our free twice-daily newsletter

Sign up
Jody Clarke

Jody studied at the University of Limerick and was a senior writer for MoneyWeek. Jody is experienced in interviewing, for example digging into the lives of an ex-M15 agent and quirky business owners who have made millions. Jody’s other areas of expertise include advice on funds, stocks and house prices.