Dubai has been listed as a global property investment hotspot, according to the latest IP Global property barometer issued for the third quarter this year.
The barometer lists cities offering the best investment options in property at a given time.
The emirate has been benefiting from rising economic confidence regionally with investors seeing yields of six per cent in Dubai’s property market.
“We are pleased to see Dubai benefitting from rising economic confidence across the MENA region,” said Paul Preston, director and head of IP Global Middle East.
“Here, prices have risen an impressive 11.9 per cent in 2013 to date, with potential for more growth in a market that remains 30 per cent below the peak levels of 2008. The ever increasing inflow of expat workers in the city from all over the world is a key factor in driving consistent rental rises.”
But Preston said that investors should exercise caution, as there are chances of a property bubble reoccurring.
However, he said that the Central Bank’s recently announced regulations restricting the amount of cash that homebuyers can borrow will help in providing framework for sustainable growth.
Other best destinations for property investors included Chicago, New York, Boston and Seattle along with the Australian cities of Melbourne, Sydney and Brisbane.
Munich and Berlin, which were favourites in Q1, have made a comeback to the investment hotspot list this quarter while Tokyo makes its second appearance of the year.
Dubai’s property market has been slowly recovering from a crash in 2008 with prices rising as high as 42 per cent in the past year.
A steep rise in property prices coupled with the IMF’s warning of another bubble has prompted the Dubai government to introduce a number of regulatory measures which include a mortgage cap for first time buyers and the doubling of property transaction fees.