Although Dubai maintains its position with rental returns averaging 6–10%, other countries offer higher yield rates. Each region comes with unique advantages and drawbacks that significantly affect investment appeal. Let’s explore the pros and cons of Turkey, Indonesia, Portugal, and Spain.
Turkey
Pros:
High rental income potential (up to 8%).
Affordable property prices.
Simple property registration process.
Cons:
Difficulties selling: Overvalued seller expectations and limited buyer interest.
High taxes: Purchase tax of 4% plus annual property tax ranging from 0.1% to 0.3%.
Price volatility risk: Prices can fluctuate unpredictably.
Indonesia (Bali)
Pros:
Exceptional rental return potential (up to 10%).
Tourist-friendly atmosphere and high tourist demand.
Low-cost housing options.
Cons:
Ownership restrictions: Foreigners cannot own land outright; they must rely on leaseholds.
Political instability: Exposure to political conflicts and social unrest.
Higher inflation rate compared to Dubai, reducing long-term investment attractiveness.
Portugal
Pros:
Strong rental yields (up to 7–8%).
Pleasant climate and high tenant demand among tourists and expatriates.
Straightforward property acquisition process.
Cons:
Lengthy administrative procedures: Registration may involve bureaucratic delays.
Substantial taxation burden: Purchase tax ranges from 6% to 8%; annual property tax falls within 0.3%–0.8%.
Volatile market dynamics affected by external economic factors.
Spain
Pros:
Attractive rental yields (up to 6–7%).
Strong demand from tourists and expats alike.
Well-developed infrastructure and pleasant climatic conditions.
Cons:
Rising taxes: New regulations increase ownership expenses.
Restrictions on short-term rentals limit profit potential.
Fragmented market structure complicates identifying profitable opportunities.
Why Dubai Stands Out
Dubai stands out because it offers:
Stable market: Predictable despite regional fluctuations.
Transparent processes: Clear and straightforward buying procedure minimizes risks.
Secure investments: Robust legal framework ensures safe asset holding.
While certain regions promise higher rental returns, they carry considerable risks and challenges. Dubai provides a well-balanced combination of reliability and predictability, making it an appealing option for long-term investments.
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