There are two ways of making a profit from property in Dubai. You can look for the high rental returns or the long term appreciation in the value of your property. A word of warning, if you are looking for a quick return then you will be disappointed, those days are gone in Dubai and all investments should be viewed as a mid to long term investment.
Taking the first option; looking for a high rental return. This is a popular option in Dubai thanks to many reasons.
· You have very low purchase prices
· Very high rental prices
· An extremely high expat community of 80% driving the demand for rental properties
When looking at a buy to let property take into consideration the location, how established is the community, is it convenient to the business districts, the demographics of the local residents and of course the average rentals being achieved. It is highly recommended at this stage to discuss your plans with a property consultant who is specialized in the area you have chosen. At this moment in time there are 4 communities worth considering, Dubai Marina, Palm Jumeirah, Downtown Dubai and Emirates Living.
If you follow these guidelines and take advice from a property expert you should be looking at a net yearly return of 7.5% on your investment.
When looking at looking at the long term appreciation you need to consider all of the same criteria as the buy to let property but also look at who the developer and what have they completed before, what facilities the building has, the view from the property, is it convenient to commute to the business districts. Again if you get the above right you should see a healthy annual growth in the region of 5%.
The final piece of advice is to remember this is an investment, so make the decision with your head and not your heart. You will see property that you fall in love with but remember you are not living there and all that matters are the numbers. Done correctly a well thought through investments in Dubai will still generate a great return.
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