StublueKPL

Hi there

I'm getting truly sick of renting in Dubai. Landlords do my head in and im trying to see if we can get the funds together to buy a place for a couple of years before heading back to blighty. Would probably be looking at buying around January.

This has been asked a million times but what are the decent Springs numbers to live in? Near to shops/roads etc?

Arabian ranches - I have heard that the villas are better there than the springs. Now I don't drive (sad, I know) but the good lady does and I don't need to drive for my job offshore anyway.
What areas in the ranches are nice? What would be closest to the golf club or polo club if I fancied a beer or bite to eat?

Jumeirah Heights - now I like the look of these apartments but can anyone tell me if the swimming pools etc are open yet?

For everyones info - would be looking for a 2 bed + study or a 3-bed at reasonable costs. Budget most likely around 1.8M AED to 2.2M AED.

Any help would be very much appreciated!!

Millhouse

you must be ****ing insane.

StublueKPL

insane paying 115-135k for my 2 bed apartment with a shit landlord. and the second shit landlord in a row.

Millhouse

or you can pay around 125k in interest charges, add on service charges and own an asset in a highly political environment.

You get around 1% yield here, better to rent here and buy in the UK where you get a 5% yield without the risks.

I've looked into this a number of times and I have thought about taking a punt here too but I can't get it work. Short term gains may be possible but you need to find a greater fool to sell to.

StublueKPL

If I could get (more or less) my money back after say, 3 years, that it has cost me in mortgage interest/service fees etc then it is certainly better than me losing out on over 400K AED renting over those 3 years?

I know its a gamble but if I had done it in 2010/11 when I was first going to, I would definitely be in profit. (and that's not my main concern. Just getting my cash back would make me happy enough)

Millhouse

Maybe, no.

I think you will find that your interest + service charge payments will be higher than your rent (or about the same) - yet you take the risk on maintenance etc.

Any idea what the service charges are? Could be a 1/3 of the rent on a flat. Lower on a villa obviously.

StublueKPL

My current apartment is around 25K AED a year I was told!

I understand what you are getting at and no-one knows whats going to happen in 3 years time. maybe the rents/sales will be higher? if we knew then I certainly would not be working on a Rig drilling for oil!

For mortgage/service fees purposes, I reckon I will be paying around 5k more a month at a guestimate, that's around 150k over 3 years more than my rental (if it does not go higher that is). However, I will be paying off the mortgage in that time as well so it really is trying to weigh up whether the prices will rise on villas/apartments in that time so that I don't end up losing too much.

its a gamble, I know, but i'm sick of renting.

Blue Cat

I am with Millhouse of this one, if you do go for an apartment think of re-sale opportunities? the market is flooded with empty apartments as it is. The Ranches seem to get better prices than the Springs. Springs 1, 2 and 3 are the better options. Never heard of Jumeirah Heights so can't comment on that one. If you are only planning on being here a couple of years rent somewhere in TECOM, I am pretty sure they are reasonably priced. My gut feeling tells me we are going to have another property collapse here in a few years anyway.

mikewot

Look at the number of apartment blocks being built, just in Victory Heights there are at least 15 massive blocks. Who are they expecting to live there as there is no public transport, unless RTA start putting on buses, and some blocks have no car parking and you're fined if you park on the desert.
I believe that underoccupancy in JLT is around 50% and the Marina is worse with around 45% occupancy.

Meow

Having to own a property instead of renting is such a British thing. People forget that property is still an investment (and a large one at that) can go down as well as up in value and that there are a lot of costs associated with the purchase, sale and ongoing ownership.

I understand the logic of not wanting to pay rent, but unless you are really prepared to hold the property for the long term, it's very risky. There is never a guarantee that you can sell it, especially with each lender having a panel of developments they will consider and if LTVs are restricted that reduces the market immediately.

Blue Cat

yet landlords are still inflating the rents

Millhouse

Remember in the early days of mortgage the amount of principle you repay is almost nothing. It's all interest.

So... you have a 3 year view, and you will be paying more 'rent' (interest and service charge) than you currently pay and almost no mortgage will be amortised. I hope you see some capital appreciation - that is the play you are looking at. No shame in that but you will be making on the rental burden.

I live in a '650kGBP' house in the middle of the desert. In the UK, the same house would be 350k, I'd own the freehold and the structure wouldn't be eaten from the inside by ants. Can you see the point I'm making?

Blue Cat

650k for a three bed? shocking

Millhouse

If that is the case, I would like to change my position. Just for the hell of it.

Millhouse

3.5m AED ish. Big one, maid etc. but yes.

Landlord paid 4.8m for it.