It is possible to obtain a Mortgage as a non- GCC National, either resident or non-resident of the UAE, up to 50% Loan to Value (LTV) on a property that is under construction, however, this is limited to projects that have completed 50% of their construction and only then with a handful of developers.

The majority of off-plan developments have payment plans that reflect this, andyou will find 30/70, 40/60 and 50/50 plans on offer from developers, i.e. 50% between booking and completion in construction linked instalments of between 5% and 20% with the final 50% due on Completion. 

Once a building has a Completion Certificate issued then the overseas buyer canbook a Mortgage to make the final instalment to the developer. 

A 50% LTV Mortgage is a straightforward application and approval process while 51% to 75% LTV is much more stringent and complicated.
 

If you have been reading the Dubai property news, then you will know that rents and prices are under pressure, meaning that they are coming down off recent highs.

These reports do not tell the entire story, and it’s important to understand the real facts behind the headlines

The buildings that are poorly maintained, badly designed, have low-qualityrecreational facilities combined with a lack of decent parking are experiencing a definite drop in rents however yields and occupancy levels remain respectable which is not mentioned in many of the reports.

A property that sells for under AED 500k (£100K) and you can expect very small units or inferior quality therefore tough to find a tenant or future buyer but receives a high rental yield. 

Property over AED 1.5m (£300k) and you have more luxury in a central location which receives a good demand from buyers and tenants but a lower rental yield. 

The sweet spot and focus for investors looking for above-average rental yield combined with quality in Dubai needs to be properties priced between AED 500k and AED 1.5m (GB£ 100k to £300k). 
 

Airbnb was officially sanctioned by the Dubai Tourism authority in 2016, and Ras Al Khaimah followed suit in January 2018, signing an agreement with Airbnb to promote "new rules and responsible home sharing," seen as the last hurdle to a full-scale launch in the emirate.

Owners planning to rent their properties short-term in Dubai or Ras Al Khaimahneed to register with the relevant tourism authorities and gain a permit but there are now licensed specialist companies who will fully manage the property and administer the paperwork required so that overseas and local owners can gain an income from their holiday homes without getting involved in the day to day running. Read more here

Another busy week for Dubai property: -

Dubai’s world-class infrastructure, geographical location, the frequency of air connectivity and the Emirates’ liberal socio-economic policies and political stability make Dubai a natural choice for Indians to invest in their second, third or fourth home. 

Indian nationals, who form the largest foreign investor group in Dubai’s real estate, have bought properties worth AED 83.65 billion in the last five years – from 2013 to 2017 – in Dubai’s property sector, according to statistics compiled by Dubai Land Department. Read more here

A few developers in Dubai spend millions of dollars promoting their projects to investors here in the UAE and internationally, and a few years ago, the sales message was all about low price per square foot but now it's about low entry prices. 

There have been some articles in the property sections of local newspapers recently that have reported on and listed the areas in Dubai that give the best rental yields/returns.

Interesting reading perhaps, but misleading, as these league tables are calculatedon the average values and rents across all buildings in each specific community or suburb. 

Real Estate agents, pundits and owners all over the world speak about location, location, location however here in Dubai one cannot base the rent/yield/value on just this mantra.

New legislation for non-government backed developers in Dubai has been proposed by the Real Estate regulatory bodies and its designed to protect investors further.

It's possible that developers will only be able to launch sales on off-plan projects once construction reaches the 50 percent mark. This is intended to reduce the risk of market oversupply and could result in consolidation among smaller private developers.

Presently the law states that the developer must complete 20 percent of the project or they must provide proof of 20 percent of construction funds in addition to a 10 percent performance bond by the contractor. 

This proposal is likely to slow down the pace of off-plan launches in the short term. It will also reduce the current risk of a few developers flooding the market with sometimes lower quality properties at discounted prices and attractive payment plans.

Property discussions this week have been as follows: -

This week we learned that the commercial insurance unit of Warren Buffett’s Berkshire Hathaway has expanded into Dubai, after getting a license from the local regulator. Berkshire Hathaway Specialty Insurance Company (BHSI) established an office in the Dubai International Financial Centre (DIFC)

The press has also reported that there have been 1,600 new business registrations in January 2018 and that the number of active businesses in Dubai increased to 148,842 in 2017, including 19,877 new trade licenses issued in 2017, according to the Dubai Economy, the trade licensing body of Dubai Government.

These are some of the properties that we have been talking about this week:-

1.27 million British people visited Dubai last year helping the city’s international visitor numbers grow to a new record as we inch closer to achieving a target ofwelcoming 20 million travellers annually by 2020

Many of those visitors arrive at the busiest international airport in the world but then leave immediately for Ras Al Khaimah (RAK), the fourth largest emirate in the UAE, who reported a growth of 19 percent in the overall number of tourists in 2017. 

RAK is well on the way to welcoming One Million visitors by the end of this year, and you may be surprised to learn that half of those tourists are ex-pats and nationals living in the UAE. The hotels are often fully booked on the weekends, and there is a healthy demand for both temporary and permanent holiday homes from residents and their families looking to escape the city at weekends and during the school holidays. 

Ras Al Khaimah is the perfect beach and desert escape, but with the recent opening of a world record-breaking zip line suspended 1,680 metres in the sky and reaching speeds close to 150 kilometres per hour, it is now the ‘go-to’ destination for adrenaline junkies in the Middle East.

Did you know that many Dubai locals and ex-pats include cycling as part of their fitness regime? 

Dubai plans to have 500 km of dedicated cycle tracks within three years, andthese tracks will often connect with the major communities, in fact, all self-respecting master developers are incorporating a cycle track alongside or combined with a jogging track. 

Perhaps we will soon claim the accolade of being the fittest city in the world

It was a slow week for new launches however it was a busy week for sales and rentals:-

There are less than 1,000 days to go until EXPO 2020 in Dubai and the international marketing campaign was launched this week.

EXPO 2020 Dubai will run for six months from 20 October 2020 to 10 April 2021and is expected to receive 25 million visits, with 70 percent due to come from outside the UAE - the largest proportion in the history of World Expos. 

More than 180 countries are expected to participate.

Take a look at the official website here to learn more about EXPO 2020 and to understand more about the legacy visit here

This week’s meetings and discussions have included the following:-