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Independent study into Dubai real estate due end-April
by This email address is being protected from spam bots, you need Javascript enabled to view it on Monday, 13 April 2009Posted on Tuesday, 5 May 2009
Independent Study
Posted by Arms Length? at 14:21 UAE time
it is also worth noting that Investment Boutique largely rely on a database provided to them by Shareholder BetterHomes for their market data.
The motivation for this report from BetterHomes' side is clear but what is not evident is why Investment Boutique would want to damage any reputation it has for being an 'impartial' party by taking part in such an excercise. Any one want to predict the findings?????
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Posted on Sunday, 26 April 2009
Paul's reply to Skeptic
Posted by Roman at 04:09 UAE time
It is clear that Skeptic understands the basics of investing just fine; maybe even better than you. I can't imagine why anyone with a lick of sense would invest in such a, "shifting sands", environment, when there are so many other excellent opportunities out there; due to the global meltdown. I won't be putting any of my millions into ,"houses built on sand". Good Luck!!!
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Posted on Wednesday, 15 April 2009
Paul's Economic Theory
Posted by Off to greener pastures at 12:08 UAE time
Just to add my bit to the lively debate;
No Job = No Visa = No Demand. Not sure where the people are going to come from to drive your prices or rent up Paul?
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To Paul
Posted by Skeptic at 11:39 UAE time
Paul,
I AM an investor in Property and I do understand the property market, only it's not here in the UAE !!
Why ? - You said it right - RISK !! Higher the RISK, higher the GAIN potential BUT also higher is the LOSS potential.
I was also forced to lower my rental income due to the downturn but I gladly did it not only because I wanted to keep my tenant happy but because I knew I would probably not get a new tenant quickly - thus having months to go without rentals but still having to pay mortgage. That's how the property game is to be played - don't take your tenants for granted, treat them well, coz they are the ones actually paying for 'your' property at the end of the day !!!
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Free advice (charity) for Paul
Posted by Rent Happy at 10:38 UAE time
Paul,
I am certainly capable of investing in property in the UAE. However, I decided not to risk my money due to the unsustainable nature of the Dubai property market and the numerous external factors i.e. change in rental laws at the drop of a hat, over which you have no control.
I don't invest for charity either. If you decide to jump in with both feet in a high risk market that is your decision, don't expect any charity from anyone else. The rental and housing market in Dubai was massively over inflated, required a huge correction and has done so. With a reduction in professional population over the last 6 months (demand) and increase in number of units still being built and about to come on stream (supply), page 1 of your economics for beginners book will tell you prices will continue to fall. Good.
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Re: Skeptic
Posted by Paul at 10:26 UAE time
We are not talking about speculators here - this is pure investment although from your reply i don't think you understand the basics of investments. I would ask you to put yourself in the investor's shoes and maybe you can then understand how it works. When one buys property at a certain price for investment purposes then you expect a return on investment and the higher the risks, the higher the returns otherwise it is not worthed. However, I am sure that you will not understand these basics fundamentals - all you are worried about is speculations which is a total different issue. I agree that the government should control the speculators but they should also encourage investors who keep the ball rolling. Finally, we don't need anyone's sympathy - again, we go back to the basics of investment where when you take a risk, you have to bear with the consequences. The property curve is down right now and will definitely go up again so enjoy the present rent prices as they will not last for long my friend - take my word for it!
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Re. Paul
Posted by SR at 10:08 UAE time
Of course you don't do it for charity, none of us will!! But the fact is that the risk was factored in to your expected return at the time you invested. This is a basic investment principle; the risk that you can not diversify (the type you are talking of) is factored in to your expected return at the time of investment. BUT remember, it was always an expected return, not guaranteed! If you took it as guaranteed return, then you were never taking a risk!!!
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Are you for real, Paul ???
Posted by Skeptic at 09:43 UAE time
Could not help but to respond to Paul comments that imply that in some way, we should be all be collectively 'indebted' to his tribe of greedy speculators who 'took huge risks' for the 'poor non-investors' like us - however, they were not complaining one bit when prices were climbing 10% every day (in fact they used to brag about it ad nauseum at every party or social event) but now somehow feel they should be compensated or shown sympathy for falling rentals and property prices ???
Everyone, even taxi drivers, even the tea boy in my office knew that the fall was imminent - although no one knew it would come so soon and so hard !!
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LOWER RENTS
Posted by Paul at 09:10 UAE time
I am an investor in the UAE with three properites. It is easy for anyone to say that rental prices should go down and should keep going down when you are not investing and risking your money! People like me took huge risks to invest in Dubai and help the property market so that non-investors can have the choice of living in medium to high end properties. However my friends, we don't do it for charity. The Middle East is not the most stable when it comes to investments and if prices keep going down, who is going to invest! Let's think about this before we celebrate the downfall of the property market. However, I am 100% conivnced that Dubai will be the first country to come out of this recession since they are one of the few countries in the region who have vision.
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Posted on Tuesday, 14 April 2009
Why on earth would you trust Better Homes???
Posted by Rent Happy at 21:59 UAE time
Better Homes makes their money on a percentage basis on the value of the rental income or sale value of a property. The higher the value, the greater the income for Better Homes, simple. It is in Better Homes interest to have as high a property and letting price as possible.
By coming up with an "independent survey" it is solely a means to attempt to stop the free fall in the rental and sales markets.
In their latest magazine dated April 09, they price the annual rent for a 3 bedroom apartment on the Palm Jumeirah as 210k Dhs and is apparently a "great price". Yesterday I signed a contract (through Better Homes) for exactly the same apartment for 160k Dhs. I am now off to write an email to my current (soon to be ex) landlord who refused to budge an inch from last year's rental price or the 1 cheque payment. Hopefully the market will continue to drop and people will be able to start paying realistic prices for what are after all over priced and very poorly built lumps of painted concrete....
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Independent study?
Posted by Jim at 18:14 UAE time
So, a real estate brokerage company (Bhomes), comissions its sister company "investment boutique" to conduct an independent study on Dubai's real estate market.
"They asked the fox who his witness was, and he pointed to his tail."
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Propertry Report
Posted by Peter39 at 14:54 UAE time
I don't think there is a huge amount of science in understanding why that a lack of investor confidence is the primary cause for the current state of the Dubai property market. Investor confidence fuelled the growth of this market and until it returns the market will remain depressed. The developers and agents are incidental players as they both rode on the back of the growth but they didn't cause it. The Government played an active part in it's growth by changing the rules to enable non UAE investors to benefit so the Government must therefore act again to protect the interests of the current investors and do whatever is necessary to encourage new investors back into the market. Currently, the new legislation sees to be slanted in favour of the developers and that is wrong as it will,further undermine investor confidence. Whils it is in everyone's interest for the property market to turn asround it is only the investors, helped by the Governmnet who can make it happen.
"Developers and agents come and go but when investors lose confidence they go and stay away forever"
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To Philip
Posted by Joe at 11:53 UAE time
Philip,
A few questions for you....
Better Homes has this new "Make an offer" option at their website, but if Better Homes refuses to list the property how can a potential buyer know a property is available and make an offer on that property???
How much time does it take someone to add a property to the Better Homes website....10 minutes maybe???
How much money is involved in listing a property on the website???
The good news is that one of my properties sold recently. Another company listed the property and I negotiated down with the buyer....a happy ending. But when Better Homes refuses to accept a property because they are the "experts" at what it is worth....come on Philip....let me guess, you work for Better Homes????
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Realistic measures
Posted by Omar at 10:48 UAE time
Perhaps this report will offer the transparency we are all waiting for with an insight to some possible negative news, and how long a possible negative trend will last for.
We are all looking for realistic info from true transparency (which has not been shared to date through any reports). I don't think this report will be another attempt to boost confidence for investors and the community at large. I look forward to seeing what this report summarises. I hope it includes a lot of detail.
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What's Joe talking about?
Posted by Philip at 10:28 UAE time
Joe - given that property companies tend to list properties for free then make their money by taking a cut when it's sold, why on earth should they waste their time and money listing your property at a price so high it won't sell? You're right to identify a joker here, but I'm not sure it's Better Homes.
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