Property investing in Dubai and the rest of the UAE
Should be done ideally by someone with many years of experience in the local market, and experience with property investments, as well as by someone who has a keen eye for the future of real estate in UAE. If that doesn’t necessarily describe you, you should get property investment advice from a company that knows how to avoid the common pitfalls of property investing. But how do they do that, exactly?
Pitfall: Lack of a solid plan
Prevention: A real estate advisor helps to avoid the pitfall of a lack of planning by making sure that the property matches the investment strategy and not the other way around. What usually happens is that investors find a property that they love, or that they think is a good investment, and then try to create a plan around it. What real estate advisories do is help you create a plan and then find properties to match it.
Pitfall: Short-term thinking
Prevention: One of the things that investors think is that they’ll get wealthy instantly with property investment. They are looking for that one property that will make them rich, but investment advisors know that the best investment strategy is one that works for the long-term, not the short. Building a good portfolio and slowly growing your business is much more important than getting rich quick, and much more achievable, besides being much less risky.
Pitfall: Not Utilizing Resources
Prevention: Good investment advisors know that it takes several professionals to make property investing work. You want to build the team that you need including an appraiser, inspector, attorney, lender and of course, a real estate agent. A good investment advisory will help you build the right team for long-term investing, not advise you to wear all of those hats yourself, or worse, skip the tasks that those team members do entirely.
Pitfall: Underestimating or Not Doing Homework
Prevention: Some investors think that they can eyeball a property and tell whether or not it’s going to make a profit. Some think that their 6th sense about investment properties is their biggest asset and so they could end up skipping vital homework that will reveal flaws that make a property a bad investment. In addition, good investment advisors will counsel their clients to double any estimates that they get. It seems difficult to believe, but the double estimate model will usually be closer to the actual cost than the estimate itself.