In recent years, the real estate market in the United Arab Emirates has experienced significant growth. However, not every offer merits attention. Let’s examine the drawbacks of the race for new developments.
The real estate market is witnessing an explosion of sales launches, with new projects being announced almost daily. September alone saw over ten significant launches.
Every developer, while introducing a new project, touts it as an excellent opportunity with a prime location and high investment potential—a perfect proposition for investors. However, reality often falls short of these claims.
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Some properties are being sold at unreasonably high prices due to inflated demand. The enthusiasm surrounding projects doesn’t always align with reality, yet people rush to buy real estate driven by the fear of missing out (FOMO).
Despite the increasing number of new projects and transactions, not all deals prove as profitable as anticipated. In June 2023, Dubai’s housing market witnessed an 18.8% increase in transactions, totaling 9,876, but not all of them yielded the expected returns.
Experienced brokers typically assess the prospects of each project, considering factors such as property cost, location, developer reputation, concept, and prevailing real estate prices. Investors need to stay informed about new projects promptly, prompting the creation of our channel. Subscribe to be the first to know; we frequently share information about lesser-known projects.
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In Dubai, agencies prefer marketing new residential complexes from developers, offering clients attractive conditions: high demand, low down payments, and convenient installment plans. However, only some realize that profits from most new developments often fall short.
Another lucrative avenue is investing in secondary market schemes, distressed assets, or buying back floors from developers. Reassignments and apartments on the secondary market with favorable terms are particularly appealing.
Although deals in the secondary market demand more effort, they can be highly attractive. Negotiations and discussions with the current owner are necessary, but investments in such properties can be significantly more profitable in the long run.
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Keep an eye out for investors willing to exit deals and offer properties at discounted prices. These transactions can be intriguing and profitable for investors, especially when unique opportunities in the secondary market can be identified.
