Forty-four per cent of millennial expats intend to buy a home in the UAE in the next three years, while 25 per cent would rather invest in their business before a purchase, a report said.

Meanwhile, 59 per cent said they wanted to buy outside the UAE in the next three years, in a survey conducted by dubizzle.com, a leading free classifieds website for users in the UAE.

The 59 per cent who said they wanted to buy outside the UAE, preferably in their home country was quite simply because they didn’t know how long they wished to stay in the UAE. There was however a crossover in regard to certain individuals considering to buy both abroad and the UAE within next three years, with the intention that the UAE would serve an ideal base during the prime years of their careers.

When asked about the important of buying a home in the UAE, Westerners and Arab expats scored higher than Asian expats who would rather buy a property back in their home country.

Western expats

Western expats see the UAE as a good place to make a healthy living tax-free, and have a more luxurious lifestyle than they would back home if they held the same job. They can contribute a decent share of their wallet to purchasing a home as well as have enough to live a comfortable life with the perks of putting aside a budget for entertainment.

In specific to British expats, the Brexit has stirred up many questions as to the impact it has left on this segment’s intent to purchase UAE property as opposed to shipping money home due to the exchange rates. The survey revealed higher scores for Westerners (inclusive of British expats) more than other nationalities when asked how important they felt it was to purchase a home locally here in the UAE.

With the UAE dirham having risen approximately 20 per cent against the British pound since the June 23 referendum, even though British expats may earn more pounds to the Dirham, the emerging investors within the millennial category still sees it of value to purchase locally relatively soon given the flattening out of the sale price per sq. ft. prices in Dubai’s property market, making it a ripe time to consider property purchase if the individual is keen to call the UAE home for a while.

Arab expats

A knock-on effect caused by the Arab spring over the past decade has left Arab expats (outside the GCC country group) a dominant property buyer segment here in the UAE.

According to the H1 report released by the DLD, Arab expats contributed to a total investment value in property of Dh7 billion ($1.9 billion) from 7,577 deals. Jordanians (765 transactions,) Egyptians (710 tractions) followed by Lebanese (432 transactions.)

Dubizzle’s research study highlights that the UAE remains a prominent choice for Arab millennial expats to purchase property in the UAE with 54 per cent of our sample stating that their country was not a safe place, “risky” to invest in and/or that they did not want to go back to their home countries to live long-term, 41 per cent of who were Arab expats.

Asian expats

The survey also revealed that the first time buyer Asian expat (predominantly Indian expats) millennial segment on the contrary were more in favour of purchasing their first property back home.

The more established Indian expat who already has property/properties back home would purchase in the UAE due to the UAE’s convenient geographic proximity to the homeland India and well as it being able to provide an ideal business environment to set up shop for new business entrepreneurs. The DLD’s 2016 H1 report states that Indians after UAE locals were the second biggest segment of property investors contributing 7.27 billion worth of transactions.

Reasons for not wanting to purchase in the UAE

Quite simply, those who did not want to purchase here, did not know if they wanted to spend the rest of their life here in the UAE, hence the purchase of a property meant to them commitment that they didn’t see as worthwhile. Forty-seven per cent of those who said they did not want to purchase a home in the UAE identified this as the main reason.

Thirty-four per cent of this group are planning to buy in their home country within the next 3 years, predominantly Indian expats.

Twenty-five per cent of this group said that home purchase was too early, that instead they wanted to invest their money in their own business or other businesses with ideas they support. This is a positive hopeful ripple effect caused by the political unrest in several neighbouring Arab countries leading to the start uprising as well as the close proximity of the UAE to key trade and business hubs in India.

The millennial segment is cause-driven, hungry to impact change in the world furthered by exponential technology growth and a generation that’s more receptive to big-impact ideas. For the property segment this means a start-up commercial property investor and renter today could potentially become an individual that grows into a home owner locally over time, post the initial 3 to 4 years’ challenge associated with breaking even and making a start-up successfully see the light.

Self-research (non-influenced by others) for this segment is the most important factor during the home search decision making process.

Thirty-two per cent of the segment intending to buy claimed un-aided independent self-search as being the most important factor to reply on when making their final decision.  This includes reading up on the economy, market, and communities to gather facts themselves and form an opinion. Followed by this they would confide in family and friends, after which they would firm up their perceptions by cross-referencing credible websites and apps. The least important but the most mentioned factor was agent advise - 56 per cent mentioned that they need to get agent advise to validate the perceptions they have pre-formulated by their own research, influence of friends and family and information found of preferred websites and apps.

New home search methods

36 per cent of individuals mentioned that they would rather use new home search features, such as 360 virtual reality tours to screen properties online and save time. Those that didn't see its benefit are those who have never experienced the feature as a user to form an opinion to judge.

Millennial home buying preferences

Based on dubizzle data 55.5 per cent of those looking to buy on dubizzle are of the millennial segment.

The millennial segment’s property buying preferences based on search volume numbers on dubizzle are for 1&2 BR in Dubai Marina. 1BR in JVC and 2 BRs in Dubai Land (Motor City, Sports City, etc.;) followed by 1BR apartments in JLT and 2 & 4 BR homes on the Palm. – TradeArabia News Service