Revealed: How Dubai renters can save by opting to buy

An Arabian Business investigation shows where it’s cheaper to pay a mortgage than continue to rent

Thank you for your honest and sincere comments which do not match the article. I do admire people that are not afraid of speaking out even when they risk to be silenced. I believe your opinion is quite useful for those who have less experience with this part of the world, the new comers.
I found journalism tends to be generally biased, but when it comes to real-estate, AB, is a pro.
This is quite irresponsible in my opinion, considering the general disgrace observed in 2009 here in Dubai.
Besides all the points already noted in the comments here, AB failed to warn the readers that UAE is governed by a law that dictates jail to the first default in loan payments.


The article is misleading. It ignored, deliberately or not, the annual service charges owners pay to the developer. If we take the first example the one bedroom in Marina. An average size 1-bedroom will have a service charge around AED 17000 annually which means the total cost of owning a one-bedroom is AED 3000 more than the rent, not less. Now the advantage is that you own the flat and can sell it assuming the purchase price is less than the market and there is no bubble coming any time soon. But back to my point, articles related to real estate are always misleading. wondering why?!!!

Paul Lambert


Just bought a villa on Palm Jebel Ali. I have been told it will completed in early 2015. I presume my villa price will have doubled when I move in.


There are other factors as to whether your villa will double in price by 2015. For example will the BRICS countries still be trading in the US $ dollar, as there is some discussion of them introducing a new common currency. Which countries may decide sell oil and gas for Gold, instead of dollars? Could there be a devaluation of the US $ in the future?


Timing is everything. 2007 to early 2008 prices massively over-inflated. 2009 property bottoms. Today, prices up 25-35% from where they were a year ago and rising.

The costs of buying are significant but so is the upside. A AED4m property cost AED4.2m to buy all fees in. Now property is worth AED5.5-6m so the kicker is the appreciation in capital value.

People are running scared from the increase in rents and some of us remember 2007 very well! With rents increasing, people balance up paying large rents (money down the drain) vs. putting the same cash towards actually owning something that will hopefully be worth more when the time comes to sell.

I bought because I was fed up of banging my head each time it came to negotiate the rent or paying for someone to come pack my things and move.

Repeat: timing is everything. Remember: location, location, location.

The Consultant

Those of us that remember 2007 will also remember that the property values crashed by the middle of 2008 and rents started dropping about 6 months after that once everyone involved in the property bubble started leaving.

It varies from development to development but in nominal terms prices in many areas are now back to their peak when expressed in Rupees and not far off their peak in GBP or Euro terms......clearly there are some new investors in the market these days but are they enough to keep the prices rising? Lots of international investors will have been wiped out either in the Dubai or European property crashes, as will anyone who bought an off-plan property in Dubai during the last boom which failed to materialise.


Property in the UAE is bought and sold using the UAE dirham (Dhs) which is pegged at a fixed rate to the US dollar ($). As well as researching all the pros and cons of buying property in the UAE, including a buildings life span of say 30 years. It would be wise to understand a currencies strengths and weakness and it's relationship to the wider geopolitical picture.


This article assumes that i shall only be paying the 20% deposit and nothing else in the first year. No, actually i'll also be paying the mortgage instalment payments in the first year as well making it twice the payment. This is while ignoring the fees payments to half a dozen parties for valuation fees, agency fees, land department charges.


A property is only worth the value that someone else is willing to pay for a normal market house prices go up because there is a shortage of properties and the demand is higher than supply..In dubai there are still tens of thousands of existing properties remaining unsold and tens of thousands of new properties are now planned in new develepments being built over the next year, so why are the prices increasing? because all of the agents/developers have got together and artificially increased the prices to create a false market...this will all end in tears for the same fundamental reasons it collapsed last time, IE supply is way higher than actual demand from people who actually want to live in them..


Erm, house prices are soaring all over the world!

Peter Cooper

Dubai property is rising at the fastest rate of any real estate market in the world because there is a shortage of property, particularly in the best places. If estate agents were really powerful enough to hype markets this much do you not think house prices would be soaring all over the world! You've caught a dose of Middle Eastern conspiracy disease...


above all how could one take loan for such long period when there is no gurantee or stability of return employment visa to survive in this country


The costs that are not covered by the maths:
1) Return on your 20% deposit that you would have got if you carried on renting (invested elsewhere / clearing more expensive loans)
2) Service Charge
3) Buildings insurance
4) 1% arrangement fee from bank
5) 2 or 3% exit fee from bank (most charge this)
6) True interest rates - very few people would get 3.99%
7) Major Maintenance costs (paid by landlord when you rent)


@ Nice - you make some very good points. The above article is very naive and totally ignores the responsibility that comes with home ownership. There is also the small matter of what to do if you lose your job & residency status. No problem if you're a renter. A slightly bigger issue if you have a large mortgaged loan outstanding.

Paul Lambert

I am off to buy a property off plan and can't wait to move into it next year when it is worth double the current value...........

Oh to think of all the rental money I will 'save'.

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