Nearly every human hopes to own some kind of property at some point in their life. Landed properties are some of the most valuable and common commodities on this list, and a well-chosen property can outlive its original owner, passing from generation to generation.
A recent study by the Royal Institution of Chartered Surveyors (RICS) and International Property Measurement Standards (IPMS) showed that around 85% of the worldwide wealth is tied to real estate (rather than cash or bonds etc). And yet, deciding to buy a property is easy – but deciding where and which can be quite confusing.
Following the global COVID-19 pandemic in 2020, like every other real estate market in the world, the Dubai real estate market also suffered a few setbacks. However, the Dubai market has seen a major improvement in the first half of 2021. These improvements can be tied to the following reasons;
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Rapid testing and vaccination by the UAE healthcare sector.
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Covid-19 has caused a shift in the market, with more residents wanting to move from apartments to villas as they expect to keep working from home in the foreseeable future.
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The UAE Government has implemented more suitable changes to the UAE Citizenship law and the Golden Visa.
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The UAE continues its major trend in more economic and infrastructural developments.
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The banks are offering more investor-friendly packages and mortgages for property buyers.
So if you’re looking to invest in Dubai properties, here are a few things to note:
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Know your developer: There are lots of local and international developers in the UAE, so It is very important to do a background check on your developer. Choose a developer with excellent customer service and a good track record for delivery. Evaluate the qualities of projects, and compare them with other developers.
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Visit before making a purchase decision: Most brokers are after their commissions, so do not buy based on what they tell you. Visit and see for yourself, is it in the middle of nowhere, is that why it’s so cheap? Is the promised water view non-existent? Does the place reek of odors or mosquitos? Only a site visit will reveal that.
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Know the Location: Understand the location and take note of the community features. Look out for infrastructures like nearby metro stations and bus stops, schools, health centers, malls, parks, etc. These features attract the end-users, thereby increasing the long-term value of the property.
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Do your maths: Study the price and other numbers. Consider the service charges, Land Department registration fees, management costs, mortgage costs, current and future rent, etc. Apartments should be kept for 5-10 years to get maximum benefit. Villas can be kept for longer. An apartment can offer up to 10% RoI with a minimal increase in asset value. However, Villas offer less ROI of 2-4% but have cheaper service charges and higher value appreciation. Beware of an advert that guarantees a certain RoI.
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The Government is your friend: Finally, approach the relevant government authorities for advice before and not after buying. Go to the Dubai Land Department to ask about the service charges, unit and balcony areas, and project completion dates. Visit Dubai Municipality or Dubai Development Authority to check about planning issues. Contact the RTA to check about road construction progress. Approach the master developer to see if that promised school or mall opposite will actually get built. Luckily, all government entities have decent mobile apps that save you the hassle of a visit. However, if you decide to visit in person you will be met with free specialist advice and a warm cup of tea… and a smile to match!