The United Arab Emirates are an attractive destination for real estate investors and according to BuyDubai director Denis Karásek, Czechs are strong investors on the Dubai property market.

“Czech investors typically buy studios, one-bedroom or two-bedroom apartments, mainly in areas such as Dubai Marina, Business Bay or Jumeirah Village Circle. Their primary motivation is investment returns from short- or long-term rentals, not personal housing”. Last year BuyDubai sold properties worth more than 1.3 billion crowns, mainly to Czech clients.

Filip Šejvl from the real estate agency Philip & Frank has also observed rising interest in recent years. He says the trend was fuelled by social media and stories of quick profits.

“Increased interest has been visible mainly since the post-COVID period, roughly from 2021 to 2022. At that time Dubai benefited from a combination of factors that are easy to sell to investors,” he says, referring to low taxes and favorable conditions for residents. Dubai is essentially a tax haven, particularly because individuals do not pay tax on rental income and there is no property tax as it exists in the Czech Republic.

The advantages are obvious, but investors need to recon with the security risks of the Middle East.

Jan Havel decided to buy a two-bedroom apartment that will stand on a man-made island about an hour from Dubai. It will cost him just under 10 million crowns, which he is paying in installments.

“I bought what’s known as an off-plan property that’s supposed to be completed in about a year and a half. A month ago they contacted all clients, including me, asking us to pay installments in advance in exchange for a discount. I knew tensions were building toward some kind of war, but I don’t think anyone expected to see drones falling on luxury hotels in Dubai,” he says.

At the moment he does not know whether construction will be completed on time or how the conflict will affect the value of his apartment. Like most Czech buyers, he sees it mainly as an investment and plans to rent it out.

Other BuyDubai clients are sitting tight and hoping to weather the storm.

“I do expect some decline or market fluctuation because of this situation, which unfortunately no one can control. I see it as part of the game. I’m not planning to sell my property and I’m not drawing any hasty conclusions — I’m waiting to see how the situation develops,” says another Czech investor.

Filip Šejvl from Philip & Frank says much will depend on how long the conflict lasts –and the reaction of investors.

“I see the war factor and the panic associated with it as crucial. If panic spreads and people start selling uncontrollably even at a loss, overall property prices could fall by tens of percent — and very quickly,” says Šejvl from Philip & Frank.

Problems of the real estate market may bring a lot opportunities to the real estate market in Egypt, especially to fastly growing developers project by the Red Sea and Mediterranean Sea.<br/> Prepared by the team from the foreign office CzechTrade Egypt.

Prepared by the team of CzechTrade Office in Cairo
Source: Radio Prague International, https://english.radio.cz/czech-investors-dubai-real-estate-bracing-fallout-regional-conflict-8880145
Authors: Dominik Hron, Daniela Lazarová