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The big question is, how far down are the prices going to drop before turning around? This is difficult, if not impossible, to answer. Predicting the bottom of the market is a guessing game at best.
So, if we have to answer the question above, my view would be that it is time to invest.
Historically, the biggest gains come when the market makes an upward turn.
However, you cannot precisely determine the moment a true upturn begins, so you need to consider if you have the time and emotional temperament to ride out the hard times before the market turns.
The market could be having a “cooling” effect after prices have dropped; understandably, the proposition could be debatable.
In fact, there is an old saying that could best describe the proposition: “Buy on fear, sell on greed.”
This time could be right for end-users and long- term investors. More choices in commercial, residential and hospitality related investments, lower mortgage interest rates, high rents, lower real estate prices in Dubai compared to other major cities, stronger and stricter regulations from real estate governing authority RERA, flexible payment plans for off-plan properties – all these and more are enough reasons to make the decision to buy and own your own home.
But, it is important to be thoughtful when looking for bargains in the middle of a down market.
After you have made your decision to buy, a good rule of thumb is to be prepared and hold the property for a minimum of two years to get the best return on investment if you decide to sell.
Keep in mind that there are a number of things to consider when purchasing property but none is more important than location.
They say you can change the property’s interiors or upgrade the property but you cannot move it.
The best-rated locations are those with beautiful views – panoramic view of the city at night, a glimpse of the lake, marina or ocean, or even those that overlook the Dubai Mall Fountain and Burj Khalifa.
Also consider the areas near entertainment and shopping venues, or near the business districts.
Other areas to keep a close eye on are the ones close to the Expo 2020 site.
Aside from location, the developer and its track record are also important. Credibility matters in all transactions.
Conduct due diligence to check whether the developer shows commitment towards its numerous projects in aspects such as quality and finishes, and the time of delivery.
Meanwhile, the commercial growth that is currently looking up will directly reflect in higher space absorption, and this year, we can see the generation of new jobs.
Considering this spurt in job creation, the absorption of residential units may also improve.
Dubai, a city with an endless vision, has always been a strong contender to host major events not only limited to the real estate industry but also the other sectors.
It was even named the world’s best city to invest in in the Reputation Institute survey in 2012.
After winning the Expo 2020 hosting bid in 2013, Dubai’s popularity as an investment destination surged dramatically, attracting investors from all parts of the globe. Real estate activities also increased.
With an amazing lifestyle filled with unique mega structures, top-notch attractions, constant progress and innovation, and being considered a very safe city, Dubai is expected to continue to attract local and international investors.
Source: Rakesh Mirchandani, Special to Freehold
Director, KGR Real Estate