With the property crash around corner, the Dubai Property Developer have started to try their hand at Let to Buy Schemes, in principle it is an excellent scheme to assist first time buyers onto the property ladder.
Today I paid a visit to Emaar, one of the largest developers in the UAE, to check out their scheme in the Old Town of Dubai (Built in 2007/8). The Old Town is extremely nice and unlike most developments in the region, it does not contain too many multi storey apartment blocks and is convientially located next to Dubai Mall.
The sales representative showed me a well presented 2 bed flat, with a rental value of about 210,000 DHS per annum (GBP 38,900) which would be payable in 2 cheques, 1 up front and one post date in 6 months time. If I decided to buy the property and informed Emaar within 10 months of my intentions, then this money would be put towards a deposit for the property.
The trouble is that Emaar believes that a 2 bed apartment’s value is in the region of 4,700,000 DHS, which equates to (GBP 870,370) for 1,200 sq ft. I guess it is time to re-invest in London, where I think 900K would get you a lot more.
Though with all the schemes at the moment, the issue is around financing, it seems that banks here are still offering up to 70% though the remaining 30% will be tough to find in a credit crunch.
If you look at it as just a purely rental scheme, then this offer is not too bad, though everyone I speak to, feels that the Dubai rental market is about to take a massive knock, mainly due to the fact that expatriates are losing their careers, as the Dubai starts to feel the effects of the crunch.
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