For almost four years of the existence of a full-fledged real estate market in Dubai, this area of business has undergone many significant changes. The time has passed for the so-called boom, when within a few weeks, or even days, it was possible to earn one hundred percent profit on relatively small investments. The market gradually calms down and approaches the state inherent in stable western countries. All indicators of the 2005-2006 season indicate that the main customers of the real estate market in Dubai are end users and buyers who bet on long-term investments.
A review of potential opportunities in the field of long-term investments can be carried out using three projects designed for investors with different incomes.
Win-win bets
The International City project is for the middle class. The complex consists of low-rise buildings with two-room and one-room apartments (studios). Prices start at $ 63 thousand for a "studio" with an area of 44 square meters and $ 90 thousand for a two-room apartment with an area of 66 square meters.
What is attractive about International City? The project will be fully built already in 2006, and the rent for a two-room apartment today is about $ 11 thousand per year, which in terms of yield yields 12-14% per annum.
The closest competitor to the International City project can be considered the urban area of Bar Dubai, where rents for the same type of housing have grown in recent years to $ 13-16 thousand. At the same time, there is every reason to expect a further increase in rental prices in International City
after the completion of the project by the end of 2006. The investment potential of this project is quite high. Compare the figures of $ 1363 per square meter in International City and $ 3500-
7300 per square meter on the famous projects Palm Jumeirah and Palm Jebel Ali.
Farsighted investment
One of the new large-scale projects is Jumeirah Village. The complex accommodates seven thousand villas and townhouses and is a short drive from hotels, beaches, restaurants and department stores of the prestigious Jumeirah area. In close proximity
There will be several Free Economic Zones at once: Dubai Media City, Dubai Internet City and Jebel Ali Free Zone. It is believed that the main buyers of this property will be middle and senior managers with families. At the same time, the master plan of the complex includes a complete urban infrastructure, where everything is provided - from the high-speed Internet line to playgrounds and football fields.
What makes Jumeirah Village attractive? The price for a two-bedroom townhouse in Jumeirah Village is $ 1,557 per square meter with a total area of 150 square meters. The price changes inversely with the area, and with a total area of 278 square meters it will be $ 1340 per square meter. The price also includes the land.
At the stage of the initial construction phase, the potential investment risk is higher than in finished projects. Nevertheless, in comparison with ready-made projects of this type, Jumeirah Village has much more favorable prices. So, for example, a Springs complex similar in type will require the investor to pay the market value of the object at a time, which will be about 200% of the original price (the initial price, set
by the developer at the time of the announcement of the project). For the same money, you can make a down payment for several houses in Jumeirah Village at once. Compared with the same Springs, the Jumeirah Village project compares favorably with high quality finishes and a level of architectural style.
Evidence of a future increase in project prices can serve as figures illustrating the development of such complexes. Six months before the commissioning of the Jumeirah Islands project in December 2005, there was a rapid increase in prices by 30-40%, at the moment they fluctuate between $ 1800-2200 per square meter. In the Meadows project, commissioned at the end of 2003, the buyer will give $ 2100-2450 per meter. And at Arabian Ranches, a direct "competitor" to Jumeirah Village, current prices are $ 2,000 per meter and are rising 3-5% per month.
Fundamental investment
The most expensive and most famous project in Dubai is the unique artificial island Palm Jumeirah ("Palm Jumeirah"). This and two subsequent Palm projects are designed to become symbols of the UAE. Celebrities such as David Beckham, Elton John, Michael Schumacher and Crown Prince of Monaco have already acquired property on Palm Jumeirah. At least because of this, housing here acquires elite status. Any building in this project is located on the Gulf and has panoramic views of the sea. Here, relatively affordable apartments can be a profitable investment. An apartment with two bedrooms and a living room will cost a lot - an average of $ 4000 per square meter. Moreover, the Shoreline complex in question will be ready in 2006. Other projects located on the "Palm" will be completed later, and the cost per square meter in them is more than $ 5000.
Most projects are currently under construction. So, if you need finished housing, the choice will be somewhat limited. A good apartment overlooking the sea bay (project Dubai Marina) in an already residential building costs from $ 3,000 per square meter with an area of 110 square meters for a two-room apartment. The same, but more modest in layout apartment in the complex of low-rise buildings Greens costs $ 2600 per square meter. Here, the area of a two-room apartment is from 68 to 74 square meters.
Even with this order of prices, there is no doubt in the liquidity of the real estate market. The rapid economic development of the United Arab Emirates inevitably leads to a constant population growth in the state. According to statistics, the number of inhabitants of the UAE in December 2005 amounted to more than 5 million people compared to 4.33 million in the previous year.
You can get acquainted with the projects, their location and property prices in Dubai on the company's website www.rustardubai.ru.
You can contact Rustar Real Estate by calling tel. +971 4 328 0104 or by sending a request in Russian to the Internet address [email protected]
