![]() | |
![]() | |
![]() |
Real Estate Information |
|
![]() |
Dubai or not to Buy? A Short Assessment of the Dubai Property Market
Never has there been such an ambitious and creative drive to establish a property market as has been witnessed in Dubai over the past three years. Running short on oil reserves, Dubai's crown prince, Sheikh Mohammed Al Marktoum, set out to turn Dubai into the financial, commercial and tourism capital of the Middle East and in the space of three years he has more than succeeded. The country's GDP has expanded by 17 per cent over the past year and HSBC Bank estimates that there is $42.5 billion worth of projects under construction, compared with $20 billion for the rest of the neighboring oil states put together. The result has been the rise of Dubai as the world's most glamorous property investment market. Nothing in Dubai is understated. The tiny emirate, that only five years ago was nothing more than a simple fishing village has suddenly become the Manhattan of the Middle East. Following the mantra 'bigger is better' Dubai has proudly announced the world's first seven star hotel, Burj Al Arab and is set to construct the world's biggest shopping mall, the first underwater hotel and amazingly, the longest indoors ski slope. Already the annual number of visitors stands at 5 million and is set to rise to 10 million by 2007. The scale of development has been unprecedented with apartment blocks being constructed by the dozen and selling out within days to hordes of zealous investors prepared to queue overnight to bag a bargain in Dubai. The projects being released are some of the most inventive and ambitious the world has seen, with man made islands such as The Palm and more recently The World capitalizing on the attractions of beach front living and redefining the world's geography in the process. With real estate as out of the ordinary as this, it's not difficult to see why Dubai's property market is attracting such large-scale international interest. There really is nothing like it and it seems everybody who's anybody will have a piece of Dubai. Dubai's more exclusive developments are being snapped up the celebrity classes and the world's elite. Ageing English rocker, Rod Stewart is already the proud owner of Britain [The World's miniature Britain that is!] and villas along the Palm are being bought by sports stars, film stars and anybody with upwards of ?1.5 million to spend on a private waterfront retreat. If so much has been achieved in three years, where is Dubai to go from here? Nakheel, the company behind the extraordinary Palm and The World projects already has its eye, literally, on a new development. Dream City, like the Palm is also a series of man made islands but out sizes the Palm significantly. When finished, Dream City will form the shape of an eye, with the residential element on giant eyelashes extending out into the Persian Gulf. Villas at Dream City start at ?425,000 for around 371 sq m (4,000 sq ft) of accommodation. Townhouses start at ?200,000, while one and two-bedroom apartments start at ?150,000. For the property investor seeking a lucrative return, a new market is always a risky one and the fear is that the market may collapse soon after it has taken off!. With plenty of anecdotal evidence to suggest that property prices in Dubai are rising by as much as 60% in one year, it's tempting to rush straight in and grab a piece of the action. But the canny investors will have to consider if it is too much too fast. The pace of the property market in Dubai makes is a speculators dream. It's not unheard of for properties to have been transferred up to a dozen times even before the building is complete. Many opportunistic investors are booking 10 to 20 villas in new developments, selling them at significant profits before they have been completed. Cashing in on this and perhaps in an effort to cool the market, builders are charging a fee of up to 7% each time a property is transferred and lending institutions are trying to keep some control on the market by agreeing to finance only the original sale price. In the secondary market, prices can exceed the original price by 10-70%, depending on the development's popularity. All the indications are suggesting that the initial hype is easing and prices are settling. A year and a half ago 900 houses in one development sold out in 7 hours. Many believe that demand will continue to be sustained and prices will continue to rise, though not at the frantic rates they have been rising over the past two years. In comparison to other new and emerging markets, such as those in Central and Eastern Europe, Dubai appears to be a more attractive investment. Prices in the middle market are comparative to those in Eastern European cities such as Tallinn and Krakow. Unlike these countries Dubai has the sunshine factor and a glamorous edge, which is surely contributing to the high immigration from Europe, the Gulf Region and the Indian subcontinent. Over 100,000 extra people are expected to arrive in Dubai every year. Such large-scale immigration is sure to sustain the property rental markets. Other property markets are seeing rental yields drop through the floor. Too many investors buying up properties and not enough tenants to rent them! Ireland, Britain and many of the New European capital cities are seeing yields drop to below 3%. In Dubai, rental yields have dropped from a very healthy 8-9% but are now holding firm at 6-7%. The fact that in Dubai rents are paid in advance, sometimes up to one year in advance, is surely a motivating factor for those considering a buy-to-let property in Dubai. On the downside, service charges on new development can be high, anywhere up to 4000 per annum and may be requested by the developer upfront! Despite the current boom and huge immigration into Dubai cautious investors are raising understandable questions about the security of ownership in the UAE. As yet, no law has been passed to confirm the right of foreigners to own property in any of the projects launched to date. However, the UAE allows individual emirates to issue their own legislation to regulate ownership of real property. While Dubai is committed to encouraging overseas investment, they rule by decree and decisions can be changed overnight the whim of the current ruler. The government have promised that freehold would be granted in the near future. When this happens it is likely to further boost investor confidence in the Dubai property market. If the property market in Dubai is to develop with any degree of stability, capturing the interest of second homeowners and expats seeking to relocate is essential. If the market continues to be speculator driven, the possibility of a speculative bubble is not unlikely. A revision of property ownership laws for foreign investors should encourage a more stable property investment climate, helping to avoid any crash that might be caused by a quickly exhausted investor base of opportunistic speculators. Tracey Meagher operates and maintains a number of Property Newsdesks. She regularly writes articles and features on buying property abroad. For more information on property in Dubai, visit http://propertynewsdeskdubai.blogspot.com. She also owns PropertyAuthors.com, an property investment epublishing company offering free pdf magazine articles on buying property abroad. Articles area available at http://www.propertyauthors.com
MORE RESOURCES: The ‘Most Colorful Home in Queens’ Has a Dark Secret The New York Times 'Nepo homebuying' isn't as popular as it used to be. That's actually a bad sign for the US real estate market. Business Insider Opendoor to expand nationally after stock bull run, C-suite shakeup Real Estate News by RealEstateNews.com Exclusive | NYC Real-Estate Firm Nears Deal to Buy Troubled Office Landlord Paramount The Wall Street Journal How the East Baton Rouge commercial real estate market is performing Baton Rouge Business Report Bess Freedman on Real Estate as Rates Fall Yahoo Finance Smotrich: Gaza a real estate ‘bonanza,’ Israel talking with US about dividing it up The Times of Israel Deal With Real-Estate Investment Trust Helps Bring Down Another U.S. Hospital Operator Organized Crime and Corruption Reporting Project | OCCRP Big gains for Real in DC; a Coldwell Banker M&A in NJ Real Estate News by RealEstateNews.com Sugar Pine Village honored as 2025 Best Real Estate Project of the Year by Sacramento Business Journal TahoeDailyTribune.com Bezalel Smotrich says settling Gaza could offset war costs The Jerusalem Post Smotrich says Israel sitting on a 'real estate bonanza' in Gaza, talking to the US about dividing it up The Times of Israel Mortgage rates approach 6% as Fed makes first rate cut this year Real Estate News by RealEstateNews.com This Pennsylvania Home Experienced the Most Absurd Renovations in the History of Real Estate CandysDirt.com CREF Roundup | Week 38, 2025 Frost Brown Todd Davis Hires Alexander K. Zabik to Lead Strategic Credit Platform Boston Real Estate Times Shoring Up Your Agent Force: Recruiting and Retention in the Changing Real Estate Landscape RISMedia World Property Ventures to Launch Digital Real Estate Bank Banking Exchange EQT Real Estate names first-ever global COO Private Equity Real Estate | PERE This $1.6 billion deal is a sign that the worst of the crisis in office real estate is in the past MarketWatch Watch the Video: How Bob Richards Became Boston’s 2025 Commercial Broker of the Year Boston Real Estate Times How Stacey Caito Combines Innovation and Heart to Transform Real Estate in Northern Virginia International Business Times RNR People in Real Estate – Texas & more Realty News Report Do you find that real estate buyers on the South Shore are more decisive in the fall, aiming to close before the holidays? fireislandnews.com S. Korea’s NPS takes minority stake in Nordics real estate firm Pensions & Investments Ropes & Gray Bolsters Strategic and Real Assets M&A Capabilities with Partner Michael Brueck in New York Ropes & Gray LLP Interest Rate Predictions Post Federal Reserve’s First Rate Cut in 2025 Norada Real Estate Investments I'm a Real Estate Investing Expert: Optional 721 UPREIT DSTs Can Be the Best of Both Worlds Kiplinger Post Real Estate Group buys affordable housing property Rancho Cordova Apartments The Business Journals Federal Reserve Cuts Interest Rate by 0.25%: Two More Cuts Expected in 2025 Norada Real Estate Investments GPIF makes first bets on its own for Japan property, infrastructure Pensions & Investments The area real estate market settles down goldendalesentinel.com Where Does Gordon Ramsay Live? Exploring the Chef’s International Real Estate Portfolio Architectural Digest Former Jonesboro mall property auctioned off to local bidder K8 News | Jonesboro, Arkansas M&T Bank: Continually Reallocating Away From Commercial Real Estate and Toward Consumer Lending Morningstar Clear Secure (YOU): Evaluating Valuation After Launching Real Estate Partnership With Fidelity National Financial simplywall.st Gulyas joins Portfolio to cover real estate market Talking Biz News Top residential real estate sales for September 1-5 in Longboat, Lido, St. Armands, Bird Key Your Observer When Will Be the Best Time to Buy a Home in 2025? (Hint: It’s Coming Soon) National Association of REALTORS® Real Estate Transactions | Sept. 2-5, 2025 Republic-Times Calvin Harris accuses financial adviser of stealing $22.5M for 'boondoggle' real estate project NBC News Austin is becoming a buyer's market, new real estate reports say CultureMap Austin One Big Beautiful Bill Act Provides Enhanced Real Estate and Start-Up Business Tax Incentives New England Biz Law Update REAL ESTATE | A new chapter for Arrow Power Center in West Bend, WI Washington County Insider Apollo Commercial Real Estate Finance (NYSE:ARI) CEO Stuart Rothstein Sells 52,073 Shares MarketBeat What is the real state of crime in America? WOSU Public Media Real Estate Attorney of the Year Finalist: Rocío Cristina Garcia Espinoza, Rosewood Property Company Law.com |
![]() |
![]() |
![]() |
RELATED ARTICLES
Lock In Big Profits By Offering Rent To Own Deals Why would anyone accept a lease option, rent to own deal? Why would you, as a seller/investor look to find rent to own tenants? How can you use this technique to LOCK IN profits that are much greater than would be found in a straight sale?Basically, the advantages depend on which of two end results occur: either the rent to own tenant completes on the property, or they don't. You make money either way!There are MANY people who have less than sterling credit, might not have a long time on the job, or not have a ton of money for down payment, closing, etc. Property Investing - Am I Buying for Profit or Prestige? All of us have emotional preconceptions and assumptions. They are reinforced and fine tuned by our experiences of life, be they traumatic, disciplined or consistent. What to Look Out For When Buying Off Plan Buying Off PlanIt can be difficult to decide when every deal seems to be not to be missed!There are some key things I look for when buying off plan, whether it's in the UK or abroad it makes no difference.The property must be good value now ie it compares favourably with similar properties today, and is not based on properties going up in value 10% each of next 2-3 years. Condo Hotels Offer Luxury and Great Investment Potential Not Your Typical Vacation HomeWhat could be more perfect that owning a luxury vacation home at a landmark resort and receiving rent revenue whenever you're not using it? Condo hotels are the newest trend in vacation home ownership. Live in it when you're there; rent it when you're not. Youre Not Paranoid: The House Really Hates You If you've just bought a house, you may be able to relate to a fascinating essay in Maya Angelou's book, Even the Stars Look Lonesome.When Ms. Selling Your Own Home - Pet Issues If you are selling you own home, you need to consider the effect of pets. People who are working with a real estate broker are sure to get coached about the potential negative effect of pets. Real Estate Investing - Free Vacations While Searching for Real Estate Acquisitions Real estate investing professionals look for all possible tax deductions because of the generous profits derived from real estate investing.For example, real estate investors are concerned whether the sale of their real estate is subject to capital gains taxation or qualifies as ordinary income. Industrial Income Property Financing: Part 3 of 3 Financial ConcernsOf the three types of income property, industrial property requires the greatest degree of technical expertise and experience. Likewise, financing the acquisition of an industrial income property can be, at best, very risky without adequate planning and know-how. Selling Your Home - What Can Go Wrong With Title and Lenders If you're selling your home, there are going to be difficulties at some point in the transaction. Some problems can't be fixed. How to Prequalify a Buyer When You Sell Your Home By Owner One questions many "for sale by owner" sellers ask is "how can I determine if a potential buyer can afford to buy my house?" In the real estate industry this is referred to as "pre-qualifying" a buyer. You might think this is a complex process but in reality it is actually quite simple and only involves a little math. Real Estate: Reasons and Priorities for Purchasing Property Real Estate: Reasons and Priorities for Purchasing Property. It's not just about Real Estate as an Investment. Old House? New House? Weighing Your Options Maybe it has something to do with a childhood home we fondly remember. Many of us long for old homes built with solid construction, quality craftsmanship and beautiful details. Seller Financing - Six Safety Tips Why offer seller financing when you sell? A higher price, a good return on your money, a faster sale and to sell a property that is otherwise difficult to sell. Some good reasons, but how do you do it safely?1. High Tension for the Buyer and Seller of Real Estate Can Be Reduced Tensions can run high in both the selling and buying of real estate. After all, there is a lot of money and emotion involved! There are also time pressures and numerous privacy issues to deal with. The New First Impression in Home Selling As an ASP Home Stager I know how important curb appeal can be in making that critical first impression when selling your home. However, with the growth of real estate advertising over the web, there is another first impression that you should consider when marketing your property. Ten Tips For Selling Your House One of the biggest mistakes people make when selling a house, is not understanding real estate value. It doesn't matter at all what you think your home is worth. Bubble, Bubble, Toil and Trouble? We are selling our house. We have lived here for 15 years, the longest I have ever lived anywhere; of the places since I left my parents' home I think my previous best was three years. Why Mobile Homes? There are mobile homes for sale, for much less than stick-built houses, in most areas of the country. Despite persistent predjudice against them, and sometimes the people living in them, mobile homes are the cheap housing choice of millions. Negotiating A Short Sale - The High Road to Huge Foreclosure Profits Buying foreclosures can be extremely profitable for real estate investors. However, most of these homeowners are mortgaged to the hilt. Sell Houses Fast & Top Dollar: Design Psychology How would you like to start a bidding war for your home, ending with a sales price greater than the asking price -- all within your home's first three hours on the market? That's the kind of results you can expect when you prepare your home for marketing, using Design Psychology methods! Design Psychology's innovative interior design strategies go well beyond normal cleaning, painting, and repairs, and have been proven to increase homeowner profit while shortening a home's market time. And best of all, you don't have to spend a lot of money to enjoy the benefits Design Psychology can provide! Here are a few tips for maximizing your sales price, while minimizing the out-of-pocket cost of selling your home: First, you must emotionally detach yourself from your home and begin to think of it as simply a piece of property that needs to be sold. ![]() |
home | site map |
© 2006 TIGER MEDIA |