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So you have settled in Dubai and you need somewhere to live and make your new home. If you are putting down your roots in Dubai, whether as a single person or with a family, the decision has to be made. Should you rent or should you buy?
This is a decision that is put before most of us at some time or another, but a few people would argue that getting onto the property ladder sooner rather than later is by far the best option.
Let's face it, owning a property is a fantastic investment as opposed to paying rent each month to line someone else's pocket. And the fact is, in most cases, rent will actually cost you more than a mortgage repayment would be. On top of this, you will never see a return on the money you spent on rent. Putting your hard-earned cash into your own property will see a return on your investment when you sell your property. Of course, if you are an investor rather than an end-user, choosing the right property can net you an ROI in excess of 6% in many places.
After many years of excessive interest rates, today's offerings are now even at par with some of the latest offerings in other parts of the world, the UK for example.
Depending on individual circumstances, it is now possible to get rates from as little as 2.99% fixed rate (for purchase prices up to Dh5 million) and as much as 75% loan to value.
For example, a three-bedroom Shoreline apartment for sale at Dh3.3 million. If you were renting this property, you would pay around Dh18,300 per month, whereas mortgage repayments (assuming the rate above) would be in the region of Dh11,700 per month. Source: Home Matters Mortgage Consultants
With prices stabilizing, steady growth and growing demand from people settling in Dubai, there is no doubt that your investment will definitely see you receive a strong profit when you decide to sell.
Have you had a property wealth check lately? You might just be surprised at the many options open for you.
• Thoroughly conduct due diligence each time you make an investment decision
• Experts advise owning a property rather than renting as the former is cheaper
• The UAE property market and mortgage sector offer investors many options
Read more on Buy versus Rent - Be pragmatic not speculative
Source: Dawn Draper, Special to Properties
The writer is Managing Director, Pennington Real Estate LLC