First-time investors: Here’s everything you need to know!
Considering investing in the world’s finest property market?
We couldn’t advise you any better - Since Dubai’s market continues to grow and outshine the rest of the world, every new community is turning into the next goldmine for investors where you could obtain ROI’s of up to nearly 8%!
If investing is on your radar, we’ll break down the top things you should know before becoming an investor!
The rising haven for investors
In H1, Dubai witnessed a massive rise in off-plan purchases reaching 45,271 sales in the first six months of the year. Notably, the most number of deals took place in the AED 0-3 million bracket.
Many investors have capitalised on Dubai’s growing 3-year high by building their base here from commercial, off-plan and ready units. Since Dubai has been a rising haven, we are seeing an undersupply of secondary properties.! Off-plan however, has been booming with 47,792 new units launched in H1 alone!
What should you do before investing?
There are a few crucial steps to take before jumping into your first investment in Dubai, these being:
- Start studying the market:
Since Dubai's economy is growing at rapid speeds, and the real estate scene is diverse, studying the market can help you plan better on what type of community is offering strong ROIs, what type of property suits your budget, and what kind of prices you can expect to pay.
This you can do by browsing through the property market reports, or you can take a look at our DataHub, which is updated daily to reflect all the transactions that happen across Dubai. DataHub will help you understand the predicted rental returns and sales prices for the type of property you are looking for.
- Consider off-plan vs. ready properties:
Many first-time investors don’t think about off-plan investments and usually opt for ready properties as it is mostly considered the cash cow when it comes to high ROIs. Although, off-plan properties have picked up their spot too, and are transacting more than ready properties in Dubai in 2024 - many investors are considering off-plan investments too.
Off-plan investments help buyers span out their purchase much more easily and are better for those who are looking for something outside the traditional mortgage, as many developers offer multiple different payment plans.
Decide between buying off-plan (before construction) or ready properties, as this also differs in budget and sometimes due to a lack of availability in ready properties, off-plan definitely helps as off-plan options might have lower costs and potential for value increase, while ready properties offer immediate rental income - so there is that perk.
- Understanding why location matters:
Dubai has many neighbourhoods, each with its own perks and something to set it apart. We recommend deeply looking into the location that appeals to you from things like; nearby amenities, transportation, future development plans and the highest ROI to find out which location has the best investment appeal.
Another thing to plan ahead for is to know that if you're not a UAE national, you'll likely only be able to invest in freehold properties in specific areas.
- What is the importance of potential returns:
One thing many fail to look into is potential rental income and property value appreciation, as most buyers and investors look to resell for higher prices. What many do not realise is that a great way to increase your capital appreciation is by allowing your investment to breathe and studying the market.
You would want to begin by studying historical data and current market trends to make informed decisions. And understanding the importance of potential rental income can be done by speaking to an expert agent in the market, or by browsing through market reports.
- Understand the different developers:
If you’re thinking about going for off-plan investments, you want to take some more time to plan ahead, and research the developer's reputation, track record, and financial stability so you can understand if you are ready to go ahead on this investment.
This helps gauge the project's likelihood of completion and quality as well. Plus, choosing a developer that works for you depends on things such as payment plans offered too.
- Stay up to date on city trends
Once you’ve been thinking about investing in the market, it’s time to sit back and keep tabs on Dubai's economic and market trends, ahead of just real estate.
Events and tourism growth can impact property demand and prices - this can help you understand better what potential returns you can gain and how much it could increase.
- Choosing your financing options:
Whether you are a foreign investor or a resident investor, you would want to understand your financing options ahead of time, this includes mortgages, registration fees, agency fees, and maintenance - and if you are thinking about getting a mortgage in Dubai:
Chat with our mortgage experts or take a look at how much you could expect to be paying in your mortgage.
- Think about property management:
As an investor, if you're not around to manage your property, you might want to think ahead and consider hiring a reputable property manager to handle day-to-day tasks, screen potential tenants and deal with any tenancy concerns while you are away.
You could always chat with our property management specialists to see what works for you!
Hope you found this guide helpful!
Now that you are up to speed on everything you need to know and are thinking about where to invest - take a look at our DataHub to find out what other buyers and investors are paying in Dubai.
And if you are looking for your next investment, we’re here to help! Check out our live listings here.