Dubai purchase - beware of what ?

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My point 4 was specifically referring to property bubbles but there are many similarities between property bubbles and pyramid schemes.

A good example of developments that are being bought off plan in Dubai is The Lagoons. This is an $18 Billion project and more than half of the residential properties have been sold already, even though the foundations have not even been finished yet!
http://www.lagoons.ae/

It is true that there are many empty properties in the Palms but these are mainly holiday homes.

Excuse me for being a bit cynical here but I would also like to point out that you always have to be very wary of Mr Friendly Foreigner because he will be very helpful until he gets your money/commission or whatever he is after, and he can be very elusive afterwards when you have a problem where you need his help.
 
Sorry John, I actually did think you were messing so if I insulted you I didn't mean to. My reference to money is that however modest your apartment costs to some 100K or so is not modest, obviously to the wealthy it is a modest amount. And as you said nothing else for you is affected by this investment so that's great. I'm very negative to Dubai, culturally and legally. I could say a lot worse culturally about that emirate but I try to restrain myself. Best of luck with your retirement plans
 
Dubai sounds like a great place, would love to make a trip there. I'm sure cultural events like the Dubai Comedy Festival hosted by Jim Davidson will ensure the British punters keep going there to buy property [broken link removed]
 
charliemacck,

I can only assume your post was firmly tongue in cheek !.
 
I've been to Dubai but didn't buy there. I also know people who have done well out there by 'flipping' apartments and other who haven't.

The people who did well bought offplan for €50k in 2005 with the intention of holding for 5 years. They sold last year for a profit.

The people who were burned paid an €80k stage payment with the intention of 'flipping' before the next one was due. The values didn't increase in time and they couldn't afford the next stage payment. The agent took the units off their hands - i.e. they lost their €80k. If the market had crashed they could have been compelled to close.. not sure how that would work but it doesn't sound nice...

My point is, as with any investment assess the risk - I'd say that this is a risky investment but it sounds like you already know that.

Also, have a realistic time frame. It is almost certain that Dubai is high on the curve of property values but if you have a long-term view you can wait for the next cycle if there is a crash.

Before you ask, I have nothing to do with the Dubai property market.
 
BigRog said:
charliemacck,

I can only assume your post was firmly tongue in cheek !.
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Absolutely not, a popular and influential guy as his leadership of this event shows. He was chased of British tv and out of the country by the usual leftie types but he's still loved by the man on the street, exactly the kind of guy wheeling and dealing in Dubai.
 
Fair dues to you John. It sounds like you were just looking to see if anyone had a similar experience and there seems to be an awful lot of begrudgers here and people who don't know what they are talking about. Even if Europe experiences a credit crunch Dubai airport is still a hub from all over the world and alot of people will flock there. Plus whoever commented that it is "cruel" to tourists obviously never lived there. I lived there for two years and intend going back very shortly and never experienced anything like being ill treated or arrested. I don't think it's very much to ask for that people have a little respect in places, and that is all they ask for. As regards the property market, it is still booming there and I am a little disappointed that I didn't buy a few years ago. I would say the optimum time to buy has passed - but if you have a home here and some savings then it is still recommended for investors. Abu Dhabi - a city about an hour away from Dubai - presently has the highest prices per square metre and is still rising. Best of luck with it John, I hope it works out.
 
charliemacck,

I'm actually a fan of Jim's, particularly for his unsung efforts in support of the British Armed Forces. The point I was inferring is that a comedy festival is hardly a reason for buying property somewhere.
 
I appreciate the constructive responses (tks guys) to this post which was intended as I've said before to elicit experiences, good and bad, about a Dubai purchase I have well in hand. It seems to me that the positive indications for Dubai are still very good and possibly for the short term as well. That will not last forever and one of the reasons I said I'd consider getting out next year is because some of the property soothsayers with a lot more experience in property dealing than this tenderfoot are saying that Dubai has peaked and can only be expected to slide in the future.
I now need to decide if I will leave it idle for awhile or put in a tenant.
Some say that it would sell better with a tenant, i.e. it's generating income and that's a big plus over there. Hmmm...I wonder.
Any thoughts along these lines ?
Spare me the jibes please. Most observers will note that these add little to the discourse. With my lady fair, I am doing something in my senior years that I could never have done in earlier life and on a modest scale that doesn't affect ordinary family life.
It's interesting and I'm hoping to come out the other side with a profit.
My family expect me to !!! For those who are interested, I'll stay tuned and generally relate the outcome whatever that may be.
 
I advise caution regarding leaving it idle or putting tenant in the property. I've invested off-plan in dubai on 3 different times, making a profit on each. There is no doubt that Dubai is a bubble market, therefore you must make your profit quickly and the fastest way is by flipping...don't be the last man in! (everyones fear) Also be aware that there is a large supply of apartments coming on the market all the time and they are the most readily sold as its easy to package them for selling abroad, therefore it tends to be the most competitive part of the market. what profit are you expecting? have this set in your mind and get out the week you achieve it, last thing you want is a profitable flip and profit lost on a currency move.
 
There is no doubt that Dubai is a bubble market, therefore you must make your profit quickly and the fastest way is by flipping...
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!!! Crystal Ball Time!!!
 
Magunn & 8till8 & all who are interested
There are indications in very recent days that properties identical to mine are selling at prices well nigh 100% above what I've invested. That sounds v.g. and causes me to veer towards selling before long. There's a lot of volatility out there now that wasn't as obvious three years ago when I commenced the purchasing process.
On the risk assessment side, I have a sense now reinforced by political events and well-informed commentators that the risk is on the rise and at it's peak I know that this can mean meltdown.
So my thinking is that I don't wanna be around when this happens.
Here's hoping my exit strategy goes smoothly. I accept that timing is critically important when selling up.
I knew a certain amount when commencing the purchase but will acknowledge that I've learned a lot from postings throughout AAM along the way as well.

Lots wouldn't have done it that way but what the heck. Look what Columbus would have missed if he'd done rigorous risk assessment beforehand.
 
Thats a fantastic return and you couldn't really ask for more. Your main task now is to actually achieve that return, act quickly before circumstances change. The dollar has changed in your favour in the last 2 weeks which is a bonus, don't delay!
 
I started this thread about Dubai purchases back in early August and got lots of useful comments in response and then it dried up. I'm giving it another shot now because I've held on and not tried to sell and all the while wondering if I should try my luck for a sale or sit tight for awhile.
Now in very recent days, a lot of negative stuff beginning to emerge about Dubai and I'm awondering if I've missed the boat. Just considering what my best option is now and trying to figure what's coming down the line.
Am I with a lot of others about to be screwed ?
 
I do not think you are going to be screwed. World events have caused this ajor meltdown. If you can afford it, sit tight - the markets will eventually recover. However as to when who knows. There is a massive effort on from World Leaders to try and find a workable solution. It will take time but nobody knows how long. There is alot of ground to be covered before the World Economy makes any move forward.
 
1John said:
I started this thread about Dubai purchases back in early August and got lots of useful comments in response and then it dried up. I'm giving it another shot now because I've held on and not tried to sell and all the while wondering if I should try my luck for a sale or sit tight for awhile.
Now in very recent days, a lot of negative stuff beginning to emerge about Dubai and I'm awondering if I've missed the boat. Just considering what my best option is now and trying to figure what's coming down the line.
Am I with a lot of others about to be screwed ?
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from what i can see , you cant give away property in dubai , ive been trying to sell a one bed apt in sports city for over a year now , ive been dicked around by people showing interest only to pull out at the last minute , i bought through an irish company and have been paying installments every six months since febuary 2006 , i have one more installment to make when the apt is completed but im seriously thinking of not paying as id perfer to loose three quaters of my money than all of it , i do believe i will never get a cent back from this venture , all development companys involved in overseas propety are cowboys in my view , every last one of them , to add to that , due to the alien nature of the emmirates legal framework , those who try and complain if they loose out really havent got a foot to stand on
 
IMHO Dubai is world's largest property ponzi scheme.

Would advise you to get out if you can.
 
Irish Bob - may I ask if you placed it with some Real Estate agent or how you've placed your Dubai prop on the market ?
I'm thinking sale right now and need to make a move in that direction.
I appreciate the response and wonder if there aren't many others in the same boat who are also faced with similar difficulties ?
 
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