Property Investment in Dubai: Essential Strategies for the Wise Investor
Investing in a property is a major decision and one must do a lot of research before making the final decision. Usually, it is a good idea to invest in properties that can provide high returns and receive good price increases. It should ideally be in a very friendly location and a peaceful neighborhood or an area expecting high growth and a dynamic infrastructure. Overall, these are some of the factors that you need to consider and the ones that will influence your decision.
Here are property investment strategy tips that can help you get the most ideal property in Dubai:
- Do an in-depth research – Be meticulous! Do a quick research over the Internet, a few hours is not enough especially when you’re planning a big investment. Always remember, buying a house in the U.A.E is not as simple as just buying a shirt or a book. So, it would be wise to do an in-depth research that will go for a few weeks or even a month, just to find the most ideal location/property that fits your preferences. Spend at least a month doing the computations and these will include: market conditions, interest rates, current prices and so on.
- Find the best location – As I have already explained earlier, location is the most important factor that you should influence your investment decisions. Most of the time, investors will put their money on a house or property in a cheap location. Is this wise? My answer is a definite – NO! These decisions can backfire if you haven’t done your homework carefully. Before you invest your money in a cheap location, you should also check for other factors like: accessibility, infrastructure, transport, accessibility to medical facilities, potential growth etc. I’m just saying that you should look for a location that has future promise to attract prospective residents. If you find such a location, you can be sure that the land prices in that particular area would appreciate with time and you can expect high returns in the future (good resale value).
- Always keep your options open – When you find a good location, don’t hastily jump to a conclusion that you can easily live or invest in that location. Always keep your options open, it’s advisable to consider the possibility of renting your property in the future. Keep in mind that if a contingency arises in the coming years and you might be compelled to transfer to another location. You might want to rent out that house or property, so you need to make sure that it stays in its pristine condition, to lure prospective tenants or house hunters.
- Keep haggling to get the most ideal price – A lot of property sellers will usually ask for a higher price in the beginning, but you have the right to haggle. Haggling can take a bit of a practice, but you will eventually improve your convincing power in the long run. Use this skill to convince the seller to lower their rates, assess the market conditions, the previous sales for similar properties, why does the owner want to sell? How long has it been on the market?. This helps you substantiate why you are asking for a lower price and it should help the seller understand why he is having problems selling. If you don’t have the technical knowledge about lands and properties, then I strongly suggest that you seek out some professional help. Remember if you do not buy this property, another one will come along which will also suite your tastes and budget.
- Do not take on too much debt when purchasing a property. A major property investment may require you to take a mortgage. But do NOT OVER LEVERAGE, too much debt can put you in a precarious situation, or even lead you to financial trouble. Assume a scenario if the interest rates rise 2%. If you had to rent the property, would the income cover the debt servicing?
- Too much hassle, risk and work? Then seek the help of a professional. – Delving into the property market in Dubai or anywhere else for that matter can be daunting, it would be best to hire a professional whose role is to do all the above work. They are called ABR (accredited buyers representative) they would have the training, be accredited and have no conflict of interest as they would never represent sellers and as such would never advertise property for sale. They work purely in your best interest, using multiple tools to ensure you get the best property and the best price.
- Note: This post was taken from Mr. Gordon Robertson’s blog –Property investment in Dubai strategies – All credits go to him.