​Points to consider before investing in Dubai

April 1, 2018
Written by Roshal Mascarenhas
“Only buy something that you’d be perfectly happy to hold if the market shut down for 10 years.” - Warren Buffet

The wise words of Warren Buffet surpass the futile attempts of eroding time. However, you must only worry about the market, if the one you’re looking to invest in is not as stable and booming as Dubai’s. Statistics say that more than $1 trillion are expected to enter the Dubai real estate market in terms of investment, and the numbers speak volumes.. For luxury property buyers, the real estate market can be compared to a frozen lake with variety of fish under the thin ice. All that the keen buyer has to do is know his/her way around that thin slate of ice. Metaphors aside, there are simple steps that you can take to simply make the wise decision of investing your money in Dubai. These 5 steps are all that you need to not only check if you’re investing right, but also whether you’re ready to take that plunge will only bring you sweet rewards. 
 

Step 01: Define Your Objective

For most investors, return on investment matters most, whether through annual yield or long term capital gain. You’re in for good news if you’ve decided to invest in property in Dubai. The real estate market has plenty of room to accommodate the first time buyer as comfortably as someone who has made their luxury home in Dubai. The first step towards investing in Dubai Property is to analyze what you want, and the purpose of your investment. Is it for you to enjoy some alone time, is it for you to rent out to luxury travellers? Once you have got that in check, you’ll know exactly how and where to invest your money in. which brings us to point number two. 

​Points To Consider Before Investing In Dubai


Step 02: Location, Location, Location

The thumb rule in real estate: Never underestimate the power of a great location. True, it does come with a hefty price tag, but hey - you’re as concerned about the Return On Investment (ROI) as anybody else investing. It is almost a direct correlation really - the better the address, the higher the ROI. For example: luxury property buyers in Dubai know that prime properties in Dubai come with their own set of plush amenities, and a whole list of great opportunities for a better lifestyle. As a result of which, their prime look out is to have a luxury property on a location that’s convenient for them, and at the same time has all the benefits of a great home. It often becomes difficult to choose but what really helps investors to zero down is step number three. 
 

Step 03: Research and Analyze Market Stats

As mentioned earlier, it is difficult to pick one singular location, when the array of options are so tempting! In order to counter that, and to get the best for your investment, start your own research. Start reading up on investment patterns, current trends, and predictions. More importantly, as Dubai’s skyline keeps adding to its glamorous list of concrete artistry, research on the location you are keen on buying a property at. Newer projects often look to appease the investor with an appetite. The more you research, the more insight you derive into the giant of a market that is, real-estate. 

It is also wise to note that there are properties which fall in a ‘free hold’ area. This is a blessing in disguise for those who seek make their next big property catch here, their home. Owning a property in a free hold area allows you full ownership and flexibility on the property in question, which means you get a say in how you want your home to look. 

Expenditure Vs Investment


Step 04: Expenditure vs Investment

Once you’ve done your apples-to-apples comparison on the number of properties, and the research of the market, you’ll need to peek into your own spending and saving patterns, and then add some math to it. The foolproof way of getting that magic number that you can invest is pretty easy. Based on why you’re investing (refer step one) the two formulas as below will be your guiding light:

For those looking to invest and then give up their property for rent: The rent you’re expecting to get (minus) cost maintenance, taxes, insurance, repairs, etc = your cash flow. 

For those looking to invest and utilize the property as their home/holiday home: Your Yearly income (minus) purchase price of the property (minus) your monthly expenditure = your cash flow

It has to be noted here, that each of the above are subject to your own objective behind investing in Dubai, and is subject to the real-estate market at the time of calculation.In all probability, international booming markets like Dubai’s give a 8% higher ROI as compared to others. 

Consult The Best Real Estate Agent


Step 05: Consult the Best Real Estate Agent

The real estate market in Dubai can be anyone’s strong hold with the above four steps. However, this last step is crucial. It is the familiarity with the industry, market trends and developments that sets a good real-estate agent in Dubai apart from the rest. Making the best of your investment is what you’re really chasing, and the best real estate brokers know their way around the market. For luxury property buyers, you can reap benefits by just placing a call to us. Understanding your needs is of premium importance to us and our team of determined Private Client Advisors will only guide you to what’s best for you. Once that’s sorted - congratulations, you’re well on your way to multiplying your investment value.
 

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