6 Things To Know Before You Invest In Dubai Real Estate

Investing in Dubai real estate is among the ways to earn revenue. But where should you invest, and how can you do it? All of this sounds complicated. Here’s our ultimate guide on what you need to know before you invest in Dubai.

Dubai Investment: Everything You Need to Know Before You Invest in Dubai

Dubai is a tourist destination known for its lavish lifestyle, including world-class architecture from offices, hotels, homes, etc. And even though the region was significantly affected by Covid-19, things are looking up. The UAE real estate sector has bounced back, and it’s bigger and better, thanks to reduced Covid cases, relaxed restrictions, and increased vaccination numbers. Also, the government is spending more on infrastructure; there are new initiatives to boost investments, friendly laws for foreign investors, and new project announcements. These are expected to develop the Dubai real estate sector, further increasing interest from more investors. And with all these factors favoring investment in Dubai real estate, investing in the sector would be a smart decision. But even though it’s a potentially innovative way to earn passive income, it’s advisable to understand everything about Dubai real estate before investing your money. Here’s everything you need to consider before you invest in Dubai .

Reason for Investing

Real estate in Dubai provides low liquidity on high investment deals, so it’s essential to have a clear investment purpose. That is, have clarity on your intention for investment. For example, determine whether you’re investing in homeownership, for rent or lease, or selling the property, whether in the short or long term. Understanding your why is the first step before making any investment decision.

The Market

It’s vital to perform extensive research on Dubai investment before making any decision. Read on investment patterns, current trends, market predictions, and location. More recent projects often intend to appease investors willing to take significant risks. The more you read about investing in Dubai, the more insight you gain into their real estate market.

Budget

Once you’ve understood your why, the next is to determine how much you’re willing to invest. Determining your budget will help make your search for a Dubai property more targeted, reduce searching time, and ensure that when you do like a property, you can afford to buy it. So, selecting a property within your price range won’t be hard. However, it’s advisable to speak to an experienced real estate agent to guide you on the process and confirm the actual property value.

Property Valuation

It is critical to do a property valuation before investing in Dubai real estate as it helps reduce potential risks related to purchasing a property. It also ensures that you’re paying the actual value, promotes transparency between the parties, and plays a vital role in securing a mortgage.

Property Location

It is important to consider location before making Dubai investment in real estate . There is power in a great location, but it comes with a high price tag. A good location promises a high ROI, especially since prime properties come with their own plush amenities. Also, closeness to amenities such as schools, markets, hospitals, childcare, and connectivity is suitable for your target audience and if you want to resell the property in the future. Also, check whether the location is in the freehold ownership areas or leasehold ownership areas. Investing in a freehold property, especially if you’re a foreigner, means you get 100% ownership of the property and have no limitation on what you can do with your property. So, check which areas are recommended for investing beforehand.

Expected Return on Investment (ROI)

Once you’ve compared all the available properties and researched your market extensively, it’s now time to compare your spending and saving patterns. How much will you make out of your investment depending on the current market statistics, and after how long? Also, are you earning ROI over time, or is it a one-time thing?

For example, if you’re looking to rent out your property, you can check your cash flow. For example, you can look at the rent you’re expecting to make, less the maintenance costs, taxes, repairs, insurance, etc., which leaves you with your cash flow.

If you’re interested in reselling a property, you can compare the purchase price, less the sale price, maintenance costs, taxes, repairs, insurance costs, etc., which leaves you with your profit.

Also, if, for example, you’ve invested in a crowdfunding company such as MAISOUR to own real estate, you can check the returns to see if they are in line with your capital investment.

It’s important to note that the above pointers are subject to your reason for investing in Dubai and the real estate market at the time of calculation. So, the idea is to compare how much you invested and how much you make in the long run.

Key Highlights

High return on investment (ROI) is the ultimate goal for people investing in Dubai property. However, to secure a property with good ROI, you’ll have to do your due diligence. Here’s a snapshot of what you need to consider before you invest in Dubai .

• Reasons for investing
• The market
• Budget
• Property valuation
• Location
• Facilities and amenities available in the area, including closeness to schools, education, childcare, healthcare, etc.
• Expected ROI