Property investment is one of the best investments you can make, offering both income in the form of rents and appreciation when you sell the property at a profit.
Although you can never be sure whether you make the right investment or not, there are certain pointers and tips you can follow to make sure you are on the right path and have the best chances of success.
Whether you are new to property investments or have invested several times previously we have put together a list of tips to help guide you into making the right decision for you, leaving you with the best outcome.
1. Know the market
Effective real estate investment happens when you acquire an in-depth knowledge of the particular market you are thinking of investing in.
To increase your chances of succeeding when it comes to your investment, you should properly plan out your investment and do the necessary research. This includes keeping updated on the current market trends, changes in consumer habits and behavior, mortgage rates, the market economy, and so on. These factors need to be taken into consideration all within the geographical area you are thinking of investing in.
This will make it easier to be able to predict when certain trends may change, and ultimately make a more secure investment.
2. Choose your investment strategy
When it comes to property investment, there are many different strategies you can follow. The two main strategies that tend to offer the best returns on your investment are either Buy to Sell or Buy or to Rent.
If you are looking for the most profitable long-term returns, your best option is to go for the strategy of buying a property and then renting it out. With that being said, it is also wise to look at the second option of buying to sell as this can also bring you great returns on your investment, especially when the market is growing.
The short-term rental market in Dubai is booming, with a high demand for quality and high-end properties. By investing in a property in Dubai and renting it out, investors are able to receive great returns on their investment.
3. Understand the economy
Property investment can be very risky, but if you understand the economy and have researched the market properly, you have a higher chance of making a great investment.
The return on your investment is based on how cheap you bought the property for, but another important factor is also the percentage of the return of the investment.
Dubai offers impressively high rental yields compared to other big cities. With a minimum investment ROI of 5.82%, going as high as 11%, investing in Dubai is one of the best options for investors looking to succeed in their investment. In addition, Dubai is a safe market with property demand constantly rising.
4. Decide between off-plan and ready property investments
It will have a significant impact on your investment whether you plan to invest in an off-pan project or a ready property.
Both off-plan projects and ready property investments offer different benefits and risks. This decision will depend on what it is you want from your investment.
When buying an off-plan property you are putting your investment into a project that is still in the planning or development stages. Off-plan property investment is a popular one due to the high capital gains, lower costs, and the high market demand that arises when there is a new development.
A ready property on the other hand are apartments or villas that are ready to live in and can be occupied immediately. A ready property will give you the benefit of having full control of your property, and you can start receiving returns on your investment instantly.
You will eventually end up having a better ROI through investing in an off-plan project, but you have to keep in mind that it will take longer to receive the return.
If you are not sure which option is the best for you, we are here to help you. Speak to one of our agents today to know which investment type is the best for you.
5. Plan out external costs
When investing in a property, there are also external costs that need to be factored in. These costs include maintenance costs, community fees, and registration fees of the unit.
However, with that being said you do not have to pay any property taxes on your investment when buying a property in Dubai. This will save you a great amount of money, and will eventually give you a higher return on your investment as opposed to investing in another big city outside Dubai.