While buying a property in Dubai remains an attractive option for investment, the important question of where to buy property, still remains. The first question every potential homebuyer must answer is “Where to buy a new property in Dubai?" In a well-established community in a popular location, or in a new or off-plan community in an upcoming area? MoneyCamel team weighs the pros and cons of both the options against each other, to help you make a decision.
Buying an apartment or villa in an established community has the following pros and cons:
- Great to move into immediately – If you’re looking to move into the house yourself and are planning to do so immediately, then it makes sense to buy a house in a well-established community. The community will be well-equipped with all the basic amenities, likely to be easily accessible even through public transportation and more or less fully occupied as well.
- Easy to put out on rent – It is also easy to put such a house out on rent, since it is likely to get lapped up by potential tenants very soon, owing to its popular location and established status. Rental returns will also be more lucrative and fairly stable for such a property.
- Retains its value better – This is definitely a less riskier investment, since a house developed by a good developer in a popular part of the city is likely to retain its value better than others when market fluctuations hit the prices and rents of properties. A well-established property will witness stable demand in both the secondary market as well in the rental market.
- Maintenance issues – Many popular residences in established villa communities (for e.g., Springs & Meadows and Arabian Ranches) as well as many apartments in popular areas (like Dubai Marina and Sheikh Zayed road) are more than 10 years old. With time, the houses have undergone wear and tear and thus, owners have to shell out more for the maintenance and upkeep of these houses.
- Limited price appreciation – Price appreciation will be relatively lower for houses in well-established communities, since they would have already witnessed a huge rise in prices from the time when they were delivered through the years that they grew in popularity amongst tenants and potential buyers.
Buying an off-plan or a recently completed property has its own pros and cons:
- More value for money – This option could get you a bigger and possibly better house for lesser money since more established houses would be available at a premium because of their popular status. Projects in new communities are better off as Developers learn from past mistakes and improve the over all quality on new projects.
- More choices available – You will have more choices available regarding where you would like to buy a house within the new community or apartment complex. From choosing a floor plan and the view from your home to choosing whether you would want to live closer to the community park or the community center or whether you want to be close to the main entrance or enjoy a private cul-de-sac location, you will have a variety of options available to you.
- Potential Capital Gain- A new community offers a greater potential for price appreciation since the community or the area is newly developed, and as more people begin to live here, it too will get established and gain in popularity over the years.
- Unfulfilled promises by the developer – Some developers attract investors and buyers with glamorous advertisements and promotions, but may fail to deliver on many of their promises. Some of the problems you could face include delayed hand-over of the residential unit, unfinished community facilities like parks, pool, retail center etc. as well as poor quality of construction, fittings and fixtures in the house.
- Could fail to pick up – Demand could fail to pick up for this particular area or community and you could end up with a bad investment on your hands. In such a case you would be faced with three options – sell it at a loss, rent it out at below-market rent or move into it yourself.
In a nutshell, wherever you choose to buy a house, make sure you do extensive research on your own rather than relying on the broker’s advice or the developer’s word. You can start by visiting property portals like MoneyCamel.com to browse through the thousands of available apartments and villas in the UAE and find a home that meets all your requirements. Follow it with site inspections and always try to get a word of advise from residents of the community.