Dubai City consists of two main areas, Bur Dubai (the older part) and Deira, which faces it across Dubai Creek and is now the centre of the city. Residential locations traditionally favoured by Westerners include the extremely select Jumeirah, which lies on the coast to the southwest of the city centre, and Al- Garhoud, situated on the northeastern side of the creek, near the airport. However, the recent property boom has led to a ripple effect that is enlarging the popular areas.
Most residential development is currently happening west of the city, with the majority of foreign and expatriate purchasers concentrated in an area of approximately 25 km square, within easy reach of the beaches and the city-centre facilities.
Since 2002, when, by royal decree, foreign nationals first became eligible to own property, Dubai has enjoyed a construction boom. New developments, many of them extremely luxurious and featuring the latest in technology, are springing up, particularly in areas popular with expatriates. These include Palm Island, a vast new resort development constructed in the shape of a palm, which projects 5 km into the sea off Jumeirah and extends Dubai's coastline by 61 km.
Until 2002, ownership of property in Dubai was restricted by law to citizens of the UAE and other nationals of the Arab Gulf Cooperation Council. Even when this law was reversed, there was, until recently, no federal law that recognised freehold tenure, which meant that the value of Dubai freeholds rested in essence on the country's international trading credentials and good name rather than on enforceable law. Foreigners who bought property in Dubai received a deed from the major development companies, which are, effectively, owned and controlled by Dubai's government and, ultimately, its ruler. Although this state of affairs had little or no significant effect on the burgeoning property market, it was not entirely satisfactory.
In March 2006, the Dubai government passed a long-awaited law allowing foreign freehold ownership of property in the emirate, but only in areas designated by the ruler. Owners are permitted to derive benefit from and to let their properties. It is generally understood that the freehold as set out under this law is a freehold in the international sense, whereby owners are deemed to have absolute rights in their property.
In the majority of cases, those buying freehold property in Dubai do not incur survey fees. Stamp Duty does not exist. The only significant cost, therefore, is a 1.5 per cent land registry fee, payable on completion.
Dubai's massive oil revenues make it unnecessary for the government to raise income through direct taxation. As a result, taxes are almost non-existent, and Dubai is categorised a 'no tax' emirate. There are no withholding or capital taxes. Accordingly, Dubai does not levy tax on income, including that derived from letting property owned there, nor does it charge Capital Gains Tax. Goods are purchased free of tax, which is part of the city's attraction for shoppers from all over the world. There are no property taxes in Dubai at present.
Dubai's currency is the UAE dirham (AED). The current exchange rate is about 1 AED = £0.17 GBP, or $0.27 USD or Rs. 16. Anyone wishing to work, open a bank account or rent accommodation must hold a residence visa. There are two types, one available to those employed in Dubai by a company, the other granted to family members of those so employed.
Dubai is less dependent on oil than the other UAE states. Because its reserves are predicted to run out within the next few years, it has consciously sought to diversify, a policy that has been outstandingly successful. Oil revenues have been reinvested to create a modern infrastructure and amenities. Dubai has built its current wealth mainly on its role as an international focus for commercial and industrial development, investment and tourism, and has become a regional centre for international corporate headquarters. Fifteen free trade zones are being developed, including the world's first e-business free zone. A free trade zone is an area within a country where import duties and taxes are abolished, quotas reduced or eliminated and red tape significantly decreased, to encourage foreign organisations to do business there.
Dubai also has a tradition of undertaking vast development projects, which have included the construction of the world's tallest Building i.e. Burj khalifa. Indians own more than 100 of 900 apartments in Dubai’s Burj Khalifa.