Last updated on January 15th, 2020
Dubai is known for gold trades and cheaper prices of gold compare to anywhere else in the world. It’s been said that 10 tons of gold are presented in Dubai gold market at any given time. Even if you are not buying gold in Dubai, it is impossible to not visit the gold souks in Dubai as they have become one of the most popular tourist destinations in Dubai in recent years.
Dubai Gold Souk
Dubai Gold Souk is the largest gold market in the world. It is located in the area of Deira with more than 380 gold shops. Some shops are as old as four decades. It was built in the early 1900s when some local jewellers started to trade. However, it was in 1940 when the Gold Souk was established when traders from other countries are encouraged to set up their shops. That means Dubai Gold Souk is even older than the UAE herself. Now the Gold Souk has become the icon of Dubai and now the Dubai Municipality is planning to make it more tourist-friendly.
Dubai Gold Souk opens seven days a week from 10:00 am to 10:00 pm. On Friday, the market opens at 4:00 pm. Sometimes especially in summer, some shops closed from 1:00 pm to 4:00 pm due to the hot weather.
Why Do People Still Invest in Gold?
The gold price is inversely related to the US dollar. When the US dollar is strong, the price of gold is low and easy to control. It goes without saying; a weak US dollar makes the gold price higher. People prefer to invest in gold when the economy is not doing well. Though gold is not always at the forefront of daily transactions, it is still crucial to the global economy. It has been used for thousands of years to preserve wealth. But it cannot replace paper-denominated currencies.
Here are some of the reasons which tell why do people still invest in Gold.
Gold Is Easy to Liquefy
As a gold investor, you can convert it into money effortlessly regardless of your location globally. Gold is universal and its liquidity is unparalleled.
Holds Value for A Long Time
Gold maintains value for years and even during low seasons; the price is not terribly low. It is a commodity and has an inherent value. Furthermore, gold is different from currency such as the US dollar that can lose its value horribly and cause massive losses to investors.
Hedge During Inflation
During inflation times, gold does well. It is priced in dollars and so if the US dollar deteriorates the price of gold increased. Buying gold is a solid investment against inflation and better hedge for your investment than cash.
Diversification means having several securities to reduce overall risk over your investments. Besides, gold moves inversely into stock markets and different currencies giving you an excellent way to diversify.
Gold is Universal
Gold is universal, and unlike you country’s securities, it is not affected by situations such as political instability. This universal commodity is the desired investment, and you will always find someone interested to buy.
Gold Is Always in Demand
Since gold is used in producing different products such as electronics and jewelry, its application is always in demand. This is what makes its price stable, and it will never depreciate unbearably like currencies.
How to Get Started in Gold Investment
Buying Gold Directly
Investing in gold by buying it directly is possible. This means you get it in the form of coins or bullion. You get physical gold and hold onto it until when the prices are favorable or you need cash. But though it feels good to own gold, you have to incur expenses of storage and insurance.
Investing Through Stock
This means you buy shares of any gold company. The value of the shares is correlated with gold’s value. Besides, you are likely to get dividends annually.
This refers to an exchange-traded fund, which specializes in different gold investments. This helps you reduce risk when buying gold.
Also Read: 7 Ways to Make Passive Income in Dubai
Top Tips to Remember While Buying Gold in Dubai
Buying gold in Dubai is very popular because of many things like before April 2018, it was totally duty-free but now %4 VAT has been added to the price but still, the prices are cheaper than other places. 2nd due to strict laws it is almost impossible for sellers to cheat. So buying gold in Dubai is a tension-free process. But still there are many things you should keep in mind while buying gold in Dubai.
Here we are with some top 10 tips of buying gold in Dubai.
1. Do Your Research on Prices before going to Gold Market
It is always recommended to check the prices online before going to Gold markets. The thing to note here is that gold prices changes frequently like stocks and their prices are displayed on all entrances. So keep an eye on the prices before making any purchase.
2. Have Knowledge about gold Type before going to Gold Market
Like the prices knowing about gold type is also very essential. You should have an understanding of Karat and weight of gold. Gold is available in different Karats, purity of the gold depends on the Karat that means higher the Karat purer the gold is. That means 24 Karat gold is the purest gold.
3. Don’t hesitate or feel Shy while Bargaining
While buying gold in Dubai you shouldn’t hesitate or feel shy in bargaining. Although the prices are cheap and fixed in the gold market still you get up to 50% discount on jewelry using your bargaining skills. Jewelry prices mentioned are included labor charges which are used to make the jewelry. As you know Gold is sold in Karat and their prices are fixed according to the market rate (You can’t get a discount on that). So you are bargaining only on labor prices.
4. Make Payment in Cash
Though almost all shops in the gold market have credit card machines they usually charge 1% to 2% of the amount. So it is highly recommended that you should take cash with yourself. That way you can save hundreds and thousands depending on the volume of your transaction. If you are not comfortable with keeping cash in your pocket, you can always try your luck by asking for waiving off on credit card machine charges.
5. Best Time to Buy
Try your best to buy gold during Dubai Shopping Festival or Dubai Summer Surprises. You can get amazing deals during these festivals. Dubai Shopping Festival held in months of December to January every year and Dubai Summer Surprises starts from June to August. If you can’t able to visit Dubai during these two festivals then try to buy on Saturday or Sunday. The international gold market doesn’t open till Monday at 2 pm. That is why the prices remain almost constant during these days and there is a high possibility that you will get a good deal.
6. Explore Gold Market before Buying Gold in Dubai
Because of so many shops selling gold in Dubai, There is so much competition means you can grab amazing deals. You just have to explore the market to find discounts and deals. Also exploring the market will let you see the beautiful designs.
7. Don’t Worry About the Gold’s Purity
Dubai is not only famous for the cheap prices of the gold but also Dubai is known for the purity of the gold as well. Strict laws and high competition set the highest standard among gold sellers in Dubai. So you don’t have to worry about the quality of the material and focus on the designs and the styles.
8. Always Check for Hallmark Markings
Though you don’t have to worry about the purity of the gold still you should make sure that only buy the jewelry which is marked and certified by the authority. The purity of gold jewelry sold in Dubai is ensured by the Dubai Central Laboratories Department (DCLD) through Bareeq Certification.
9. Always Check for Warranty and After-Sale Services
Due to many reasons, it is quite possible that your jewelry can get damaged. That is why it is highly recommended that you should check the warranty and after-sale services from the seller. Many sellers offer a one-year warranty which even included free repair services.
10. Before Going back You Should Know that How much You Can Take with Yourself
The last but very important thing to remember before buying jewelry is to check how much jewelry you have permission to take with yourself when flying back to your country. Each country has its own policies, so you should check on your country’s customs website to avoid heavy fines.
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Gold remains a great option when looking for an investment that will not fail during inflation; however, do research and think thoroughly before you finally settle for any particular gold investment in Dubai. Be sure to follow the above-given tips to before considering any investment in gold.