Buying a property in Dubai means an opportunity to make this wonderful city your second home and/or favorably invest your money, thereby receiving a stable rental income and having a capital growth over stable property price increase.
As with any other investment, if you have decided to buy property in Dubai, you should bear in mind certain things which you should not do and which you shouldn’t count on.
- Bought today – sold tomorrow. A property purchase is a mid-term investment. You have got expenses like broker’s commission and a governmental fee for registration of ownership rights. It will take some time for these expenses to pay off. Besides, a property is generally not a high liquidity investment and it will be quite unlikely to sell a property for a good price in a couple of days. However, the flipside of that coin is that, if you have decided to buy property in Dubai – it is a secure investment with a stable income.
- Emotional purchase without evaluating why you buy it. Quite often, the holiday mood is quite jolly and if an opportunity presents itself to buy a property, you may easily agree on such purchase, not knowing how you will use this property.
Think why you need it, before you buy it. One option, for instance, is just for having something whereto you can always come back for holidays in UAE. Another is for having a residency. The third option is for a short-term stay and rent for the rest of the year. There is a particular type of property, suitable for each of these scenarios.
- Buying on installments without sufficient own funds – when buying properties off-plan, that is, whilst, it is still being built, there is an option to settle the payments in installments, each of which covers a certain construction stage. This gives an opportunity to pay for a unit over a certain period of time. This option, however, must be backed up with sufficient funds for payments by the buyer. In case of any difficulties with payment, the unit may be taken by the developer. The resale of such unit is limited by the government and is only possible after at least 40% of unit’s value has been covered by the buyer.
- A purchase based on the unfounded profit expectations – very often, buyers misjudge the real profitability of a property. For starters, all additional expenses are often being forgotten, when evaluating property’s profitability. Further to the above, when evaluating rental income, the maintenance costs of the property which must be covered by the landlord are also often omitted. The wear and tear, that is, the depreciation of a property is also often not considered. Considering all the above will give a clear picture of what the profit really comes to.
One more false expectation is that of the unfoundedly high rents. This often pertains to the hotel apartments, which are often sold with the promise of extremely high rental income.
- Lack of necessary due diligence for a property – often leads to a whole range of following problems. Always check documents of ownership and carefully read the documents to be signed. If you do not have a legal knowledge and experience – revert to the specialists.
If you follow all the above guidelines, you will be able to favorably purchase real estate in Dubai, UAE, whereby, as stated above , you have always the option to revert to the qualified specialists for a legal advice.
The main secret of success is to revert prior to property purchase and not afterwards, when everything is signed cannot be undone.
For all legal queries when buying a property – write to us. Our contact details are on our website in “Contacts” section.