Staying in Dubai- Buying vs Renting
 

Hi, Moving to Dubai with 2 kids soon and the plan is to spend 2-3 years there before returning.

We would definitely need a 3 bed, and since I hope to find work, I would like to have a full time live in nanny as well - which probably means having an additional maids room.

I was just looking at rentals at apartments/ villas of our choice and nothing seems to be lower than 180K as advertised on the net. The stuff we really like is about 200K. I dont know if there are commissions/ taxes/ fees/ deposits that go on top of it.

So I'm thinking maybe its better to buy a place, and then three years later if we sell it for the same price atleast we would have saved on rent.

However, I am sure many before me have pondered the same and would like to hear what people who have experience staying in Dubai have to say.

How expensive is it (in terms of commissions, paperwork and taxes) to buy property? How easy is it to sell later?

What are mortgage interest rates like?

Re: Staying in Dubai- Buying vs Renting
 

stick with the rent.

Re: Staying in Dubai- Buying vs Renting
 

Thanks - I would love to hear more about your experiences.

Re: Staying in Dubai- Buying vs Renting
 

I rent. :)

4% stamp duty, can be difficult to sell, and very high deposit requirements for the loans.

Rent isn't always wasted money - remember you pay interest on loans which is basically rent, and over the first couple of years on a loan you are mostly paying interest and fees.

Re: Staying in Dubai- Buying vs Renting
 

Rent, rent , rent.....

For the timescales you are looking at, the costs associated with buying and, eventually selling a property, far outweigh any perceived stretch to your rental budget...

Re: Staying in Dubai- Buying vs Renting
 

Exactly.


Dubai is an immature market and far more volatile than the UK and much less secure. That is far too short a period to think about buying and selling. As with all other assets classes the value of property can go down as well as up and here it can go way down.

Re: Staying in Dubai- Buying vs Renting
 

Oooohhh. High praise from the all-knowing one..

If O&G's love affair with me ever cools, I might head for the finance world..!!!

Re: Staying in Dubai- Buying vs Renting
 

:( :( The thought of all that rent money is just making me cry.....

DH's company offers an all in cash package - no housing there.

Maybe I can search for a job with one of these lovely companies that offer HA and allow rent to buy..... How do I find them?

Re: Staying in Dubai- Buying vs Renting
 

Forget it.

It's just not worth it. Only buy if you can afford to lose the money. I've lived here when property values halved within months. And it can happen again.

First of all, you're not getting a local mortgage right away as you're new to the country.

If you managed to buy something, in addition to the interest on your mortgage you have pretty stiff annual maintenance fees to pay. The interest + maintenance fees will probably come close to the comparable market rent for the property. And that's money down the drain. If you want to moan over the differential, remember that renting gives you peace of mind because you're not stuck with a property to keep up or worrying about selling when the time comes. If you need to leave the UAE quickly, no problem there.

Whether your husband's package has a housing allowance or not is irrelevant. The concept of these various benefits are always a bit of a red herring. It's only the total value of the package that matters. For example, a base salary of 20K plus a housing allowance of 20K = 40k, yet an "all-in" package of 50K is clearly superior even if there is no separate "housing allowance."

As for finding work, no clue as to what you do so can't help there. Whether you'll make good money depends on what you do.

Re: Staying in Dubai- Buying vs Renting
 

wait until you start paying the school fees and the utility bills.

Re: Staying in Dubai- Buying vs Renting
 

You need a frontal lobotomy if you turn up and buy somewhere straight away.

Re: Staying in Dubai- Buying vs Renting
 

We've been here quite a while now, and spent a lot on rent over the years.

It's been worth every dirham though, knowing if things go bad (lose job, laws change, regional conflict etc..) we can jump on a plane and be out of here without any ties.

Trust me, the ability to sleep soundly at night far outweighs owning a property.

Re: Staying in Dubai- Buying vs Renting
 

Any perceived cost or loss is far outweighed by the benefit of getting the Fck outta town when you have to..

Re: Staying in Dubai- Buying vs Renting
 

Consider rent as just any other utility. The cost of doing business.

The same advice is given to most folks, in most parts of BE really, if you're new to the country and are likely not going to be there for more than a couple of years or so.

Peace of mind as the folks above have said, really is priceless.

Re: Staying in Dubai- Buying vs Renting
 

The interesting thing on this that's specific to the UAE, is that the loan interest + service charges and any maintenance is not that far off the rent. The UAE had the worst performing housing market globally in 2015 (-10%) and there is plenty more to come this year.

Re: Staying in Dubai- Buying vs Renting
 

I think I am aright in saying that another consideration is that you are not allowed to do a final exit from Dubai unless all loans and debts are paid.

This would mean that you would have to sell your property before you leave.

This would be compounded and made worse if the value of your property had gone down below the value of the mortgage/loan (as it did around 2007) and you would have to pay off the difference in the loan.

A work colleague bought a villa for around £250,000 in 2007. By 2009 it was worth half that. Luckily she was able to stay working in Dubai until it recovered back to it's original value.

Another colleague has paid the deposit for a property in 2007 using a loan. The property has never been built. They are currently fighting to have the loan wiped as the building is unlikely to happen.

Rent, Rent, Rent, Rent every time:amen:

Re: Staying in Dubai- Buying vs Renting
 

Buy a big boat and live in a harbour...actually a friend of a friend did this an AUH in the silly times of 2007.

Re: Staying in Dubai- Buying vs Renting
 

Do I make you feel good? ;)

Re: Staying in Dubai- Buying vs Renting
 

You also need a deposit of 25%, plus other fees which are in the region of 5-8%.

Buying here has to be a long term option taken on with your eyes open. Don't believe the hype, property is not immune from risk, and pay attention to what everyone is saying on here. We might know a thing or two about what goes on...

Re: Staying in Dubai- Buying vs Renting
 

Well - whose buying all these properties here then?? I think for expats it's mostly Indians, Pakistanis and Brits. in that order. Lots of people buy and sell property here all the time. I bought a property in 2007. If I sold it now for even less than I paid for it I would make money on the currency if converting to Sterling.

Re: Staying in Dubai- Buying vs Renting
 

Quite. Just because one person has done alright, over a period of nine years I note, it doesn't mean everyone else would be okay. Could "logic" be more flawed?

Re: Staying in Dubai- Buying vs Renting
 

They were also saved by a 30%+ drop in the value of the GBP. In local currency it's probably break even of negative.

The 30% GBP drop won't be repeated for a while - unless of course BREXIT totally destroys the currency.

Re: Staying in Dubai- Buying vs Renting
 

Which is why so many are so bad at it... ;)

Re: Staying in Dubai- Buying vs Renting
 

Hmmm..... property prices in central London are becoming un-affordable. Maybe time to buy a cottage on the southern coast of France or Italy.

Re: Staying in Dubai- Buying vs Renting
 

I do not disagree with you. (Which is why I said there will not be a currency saviour for the UAE housing investments by Brits).

But do not forget September 16th, 1992.

Re: Staying in Dubai- Buying vs Renting
 

Im purring with pleasure...!!!:o