Risks of Real Estate Investment in Dubai
One of the best and most profitable way to build your wealth and generate a steady income nowadays is through investing in properties. However, you need to make sure you do extensive research when it comes to the advantages and disadvantages of investing in a certain place or country.
In the past few years, it has become extremely popular to invest in the United Arab Emirates. At this point, you must have heard how beneficial it is to invest in an ever-growing, cosmopolitan city like Dubai. This is because, without a developer or an agent, no property owner would want you to know of the risks that come along with buying property through them, or from them. However, we are here to help you better understand and analyze the risks of real estate investment in Dubai. That is not all! We will also provide you with solutions that could help you make a wiser, more thorough decision about your next investment.
Risks to consider when you are investing in real estate
If you are set on real estate investment in Dubai, your ultimate goal should be a strong return on investment (ROI). This is to say, you need to make sure that the property you are investing in will generate a good amount of money compared to the money you spent.
We have spotted some of the most important aspects for you to consider before making any decisions regarding your next real estate investment. These include:
Bad location
Although it is usually deemed an ideal place to invest in property in, Dubai is still a developing city, which means not all locations in Dubai are good for real estate. This is because some locations are in secluded areas where no services are available. Real estate investment in Dubai means you consider that the people renting your property are foreigners or office workers who need to live near essential services. You would not want to spend your life savings on a place that no one wants to rent or invest in.
What we mean by services is the facilities available within the surrounding community, including vicinity to transportation, education institutions, daycare, malls, and marketplace, etc.
What you can do is visit the place or ask people who live in Dubai about the place, and make sure that essential services are accessible. You also need to do some research on the future plans for this specific location. This is to make sure that future projects will not affect the monetary worth of your property.
Improper size of property
Real estate investment is affordable, yet it is still considered expensive. This is a given for those who are familiar with real estate prices. This is why it is important for you to invest in a property that is suitable for your financial situation. In some locations, best type of properties to invest in are small apartments that have one bedroom (studio) with established infrastructure, while in some other locations, best thing to invest in is larger apartments with prime views.
Also, it is important to note that reselling smaller apartments is faster and has better value compared to large apartments.
Bad property quality
When you are looking to invest in property in any place in the world, not just Dubai, it is crucial that you make sure the quality of the building is good. This means the building needs to have a strong foundation, good infrastructure, and proper water, electricity, gas, heating lines, but most importantly a good developer. All the things we mentioned before are strongly attached to the developer of the property.
One of the most important things to look out for is the “developer”. This is almost as important as choosing the area of investment itself. If you wish to put your money in a valuable investment, then having a good developer will be your key to investing in a great-quality building.
If you ensure that the property you are investing in is in the hands of a good developer, you will save up on maintenance and renovation costs. That’s why choosing a good developer is crucial for a good property investment. This way, you are also making a worthy purchase since other people will also be interested in renting or buying a property that has excellent quality.
Dealing with a bad agent
One piece of genuine advice we can give you on real estate investment in Dubai is never settling on an agent without having a general idea about your end-goal, your financial abilities, and your expectations. You need an agent that is both competent and honest with you at all times.
You do not need to deal with an agent who constantly fakes information to sell you the property without caring about your specific needs. You also definitely do not want to spend your money on an agent who is not competent and does not know how to direct your purchase.
Final words
Truth be said, it is never an easy decision to go into property investment. However, real estate investment in Dubai is mostly the right decision to make if you are careful with your purchase. People will tell you to wait for the right time, but there is never a right time to invest your money in a worthy business. Whenever you have the money, experience, and time for real estate investment, do not hesitate and take that first step toward doubling your income.
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