Election-stressed UK investors eye safe and prosperous Dubai

The emirate’s many attractions – including a thriving property market and low crime rate – are enticing the wealthy in uncertain times.

As the UK prepares for a General Election on 04 July that looks set to usher in a new leftist Labour government, analysts say the country’s wealthy – from foreign billionaires to City of London bankers – are rushing to shelter their money.

The country is currently facing significant economic disruption, with projections that around 9,500 millionaires will leave this year – and for the third year running, the largest inflow will benefit the UAE, particularly Dubai.

Why are UK investors leaving for Dubai?

Brexit impact: The UK's exit from the European Union has created economic jitters and complexities in trade and investment, making the country less attractive to wealthy individuals.

Energy crisis: Rising energy costs have added financial pressure, prompting many to seek more stable environments.

High inflation rates: The UK's high inflation rates are eroding wealth and savings, causing the affluent to look for more financially secure locations.

Dubai’s enticing real estate market: The average property price per square foot in London in the first quarter of 2024 was $824 – in Dubai it was $352. There’s also Dubai’s high rental yield; an impressive 5-7% on average.

Dubai’s favourable tax set-up: The emirate’s tax structure is also highly appealing to wealthy UK investors. Individuals do not pay income tax in the emirate, making it attractive for high earners, and there is no capital gains tax, which benefits investors. Additionally, there is no inheritance tax, allowing wealth to be passed on without incurring taxes. While a 9% corporate tax was introduced in June 2023, there are many exemptions, particularly for businesses in free zones.

Easy visas: Then there’s Dubai’s welcoming visa process – including the Golden Visa.

Higher standard of living: The emirate also provides a famously luxurious lifestyle, year-round sunshine, excellent healthcare, top-tier education, and an extremely low crime rate – all leading to an unbeatable quality of life.

Dubai’s ongoing millionaire appeal

Over the years, the UAE has welcomed 99,000 millionaires, with more than 72,000 currently living in Dubai alone, according to the World’s Wealthiest Cities Report 2024.

The report states: “Traditionally, cities like London, New York, Singapore, and Hong Kong have been the preferred choice for the affluent. However, deteriorating geopolitical situations, significant tax shifts, policy changes and a supply crunch leading to price hikes have prompted the wealthy to look towards Dubai as their new abode."

The city now boasts the highest concentration of wealthy individuals in the Middle East, with a collective net worth exceeding Dh3.7 trillion.

Dubai’s overall appeal

While the media headlines continue to grab attention, Simon Baker, Managing Director at haus & haus emphasised there is more to Dubai’s rising popularity with UK residents than just escaping election upheaval.

“Yes, the upcoming election may be causing a recent surge in UK investors to look at Dubai, but that’s by no means the only reason they want to come. Post Covid, the emirate has continued to enjoy an influx of wealthy Brits, particularly from London, because of the massive increase in the quality of healthcare and education over the last decade, and the fact it offers a much safer environment – which is particularly important for those with young families.”

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