Investments in housing stock in such an active city as Dubai bring good dividends. A foreign investor in Dubai can count not only on a payback period of 10 to 20 years, but also on obtaining a local residence permit. However, in order for the purchase to be successful, you need to know exactly how the emirate’s housing market works.
You will learn why it is worth investing in real estate in Dubai, how to avoid risks and what factors to consider when choosing, you will learn from this article.
In Dubai, real estate is considered the most profitable investment. There are several reasons for this:
Dubai has become a popular place to buy a second home in a recent survey of more than 12,000 respondents, thanks to its infrastructure, a successful strategy to combat the pandemic, and the introduction of visa and labor reforms. The survey was conducted by the company InterNations, which is engaged in establishing communications between immigrants around the world.
Many foreigners choose Dubai for investment, as they are sure that their funds will be safe here – the dirham exchange rate against the dollar has not changed since 1997. But another argument in favor of this condition is the possibility not only to save, but also to increase the investment. To do this, it is important to choose the right object.
The rationality of investments in housing stock can be assessed from different positions. One of the most obvious options is to rent out your property and generate income. Potential investors should consider the following:
Another way to make money on an investment is to resell it later. So, it is possible to enter the project at the construction stage (this stage is called off-plan). Further, you have the right to either transfer the property while it is being built and benefit from a small price difference, or wait until the construction is completed and sell the finished housing with a significant increase in value. In any case, the seller remains in the black, as any housing becomes more expensive as it approaches the completion of construction. The earlier you buy real estate, the higher your dividends will be.
In this context, we will consider exactly the option of apartments as the most in demand in terms of rent and more comfortable in resale.
Based on all of the above, before investing in an object, it is necessary to take into account some aspects. Investing in real estate in Dubai today can be very profitable if you take a number of actions before the deal:
The real estate market of the emirate is strictly controlled by the Government of the country, therefore, in many aspects, both buyers and sellers feel protected. However, it is worth paying attention to some details in order to minimize the risks of investors. Thus, problems may arise when purchasing objects off-plan.
One of the main fears of potential home buyers at the construction stage is the question: what will happen to investments if the developer freezes construction or delays delivery? The situation with the delayed release of the building, although infrequent, but still existing, and this problem may affect the buyer of the property.
To ensure the security of your casino royal club complaints, it is important to make sure that the sale and purchase agreement clearly states the date of completion of the construction, as well as the actions of the developer company in case it does not meet the agreed deadlines. Cases when the project ceases to exist even before completion are extremely rare, but no one is immune from them. In order not to find yourself in an unpleasant situation and not lose the money invested, you can either study the activities of the developer on your own in advance and make sure of the reliability of his reputation, or trust the professionals. Realtors strive to reduce the financial burden on the investor, and thanks to their experience they can minimize possible risks.
To protect off-plan homebuyers, the Real Estate Regulatory Agency (RERA) has introduced specific legislation. According to these regulations, developers are required to accumulate all payments received by them in an escrow account, access to which they receive only after completion of a certain stage of construction. In other words, developers are also interested in handing over the object on time and on the terms specified in the contract – otherwise they will not receive t pay for your work.
Another important aspect to consider and check is the registration of the construction company, the ongoing project and their escrow account in the systems of RERA and its parent organization: the Dubai Land Department (DLD). The lack of company data on the regulator’s website should alert you and possibly affect the final decision.
In the event that the reason for the stoppage of construction is financial problems or the bankruptcy of the developer, so-called anti-crisis enterprises can come to the rescue, which provide affected investors with options for transferring ownership of already completed projects. Such companies work with objects ready for commissioning, offering them to buyers as alternatives, similar in characteristics, to the living space that the previous developer did not complete. Another way to solve the problem will be the transfer of rights to complete construction to another company.
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