Investor Guide · Germany
Investing in Dubai from Germany
Why Germany invests in Dubai
German investors continue to look favourably towards Dubai real estate as their domestic market has undergone a significant contraction in the past 24 months.
For the past 2 years, the German Statistical Office’s house price index has shown consistent quarter-on-quarter declines.
The anticipated recovery of the German housing market took longer than expected, with prices now roughly 14% below their peak. A recent Reuters poll now suggests that the modest 3% growth expected this year is in question too, as two-thirds of respondents stated they believe there is more chance actual growth will be below forecast rather than beyond forecast.
"Ongoing economic policy uncertainty resulting from the German elections and the potential impact of the US administration’s economic policies are having a negative impact on consumer confidence," said Carsten Brzeski, global head of macro at ING.
"Consequently, investment decisions are likely to be postponed until uncertainty has eased. Therefore, we do not expect strong house price growth either."
This is all in stark contrast to the performance seen in the Dubai market over the same span and it is no surprise that German investors view Dubai real estate as a strong hedge to their domestic uncertainty.
What to know before investing
This has also coincided with the continued growth of Dubai’s 3rd market cycle and ever-more welcoming rules and guidelines about foreign ownership and investment, which makes the acquisition of Dubai property more simple and straightforward than at any point in the past.
The German economy ended 2024 in contraction, with a -0.2% quarter-on-quarter fall - the third year in a row with a negative Q4.
This is the first time in over 20 years that the German economy has contracted in two consecutive years.
One market that has outperformed Germany during this period is the Dubai real estate market.
The Middle East, a region witnessing double-digit growth, presents itself as a diverse and lucrative market, contrasting the modest, single-digit expansion rates typical in other prime and mature markets.
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