Should you buy or rent a Property in Real Estate market of Dubai?
Go to: Previous Article Next Article
The question of renting or buying property in Dubai is a common one among expatriates moving there. The Dubai Real Estate market has been going through rapid growth and the whole world knows of the massive construction being carried out. The market in Dubai is dynamic and quite in high demand. Yet there also remains the fact that mortgage payments in Dubai can be prove to be costlier than the monthly rent. Then there are also the experts that saying that the Dubai Real Estate market grew a little too fast and too big for its own good and that it might be time for it to correct itself by going in the opposite direction for a bit.
A very basic answer to this dilemma can be found by asking yourself how long you plan to stay in Dubai, the sort of property you prefer, how soon you wish your capital released, whether you are in for the long run or you want your property to get sufficient rent to help you repay the mortgage quickly. The reason for all this complication is that Dubai Real Estate is going through a transition period right now, which makes things very uncertain.
When in 2002 it first became possible for non-citizens to own freehold Real Estate in Dubai the mortgage was quite lower than the rent and the prices of property were also quite reasonable. Those who purchased property at that time are of course quite happy with their decision now. This created a huge demand for property and that sent the prices rocketing up at an astonishing speed. Unfortunately the rise was so rapid that it is not likely to sustain for much longer.
If your stay in Dubai is going to be around 3 years of less then there is no point in buying any property there. Just stay on rent. There are quite a few construction projects that are nearing completion and the availability of ready property is bound to lower the rent. Several of these properties are owned by investors who will want their property start paying back quickly. And as mentioned earlier the mortgage rates are higher than rental even now and the difference is going to increase once the new properties become available.
So if your stay in Dubai is going to be short-term then there is no point in buying property. Since most experts agree that the market will reverse itself soon if you buy anything now and try to sell it after three years you are likely to make a huge profit. In fact, most indications are that people investing in Dubai property at this time are going to be in a loss after a few years until the lowering of the market again reverses itself.
You should buy Dubai property only if you are going to stay there for a long time. This way you can choose longer mortgage tenure to keep payments manageable and once you are done you can rent it out and convert the property into an asset. There will be no short-term gain with this approach.
Article Source: Articlelogy.com
- Credit Cards A big selection of Cards in all flavors: Bad Credit Cards, Secured Cards, Prepaid Cards, Canada Cards, Low Interest Cards -
Word Count: 521
Reduce Your Debts Without Bankruptcy. See How Much You Can Save. Free Debt Analysis
