18d • Questions & Talks
UAE Real Estate Podcast
I had the pleasure of being part of this podcast with our partners at New Best Credit Mortgage Broker on their show, "DIVING DEEP INTO DUBAI REAL ESTATE AND MORTGAGES".
At Couture Private Estates and Property Digest Dubai, we pride ourselves on offering the same level of white-glove services as private banking, specialized for real estate investment. This conversation delves into the strategic financial concepts and robust market regulation that define successful investment in Dubai's dynamic property sector.
Key Discussion Points for the Savvy Investor
During the comprehensive discussion on The NBC Mortgage Show, Marius Bogdan provided expert consultancy, primarily aimed at investors and high-net-worth individuals (VIPs) globally, covering critical topics to maximize profits and ensure secure wealth management:
1. Maximizing Financial Leverage and Profitability
• Return on Equity (ROE): We emphasized the crucial distinction between Return on Investment (ROI) and Return on Equity (ROE). ROE calculates profitability based on the capital actually spent, which is key when leveraging proper payment plans. We shared a case study where Couture Private Estates achieved a 700% Return on Equity for a customer in just 12 months through strategic off-plan investment.
• Off-Plan Focus: Our primary focus is on off-plan projects, as this area offers the highest leverage potential for our customers.
• Payment Plan Structures: We broke down flexible payment plan structures common in the UAE market (e.g., 50/50, 80/20). We also highlighted the advantage of post-handover payment plans, which allow investors to receive keys, rent the property, or live in it while still paying installments over several years.
• Mortgage Flexibility: For residents (with Emirates ID/income), mortgages can cover up to 80% of the property value. Non-residents can access financing up to 60-65%. Mortgages can be applied for on the primary market once a developer reaches 50% construction and the buyer has paid 50% of the installments.
2. Security and Investment Strategy in Dubai
• Regulated Market and Safety: Dubai’s authorities have ensured the market is safe and secure for investors, even those buying from abroad. This is backed by the strict system of the Escrow Account.
• The Escrow Account Guarantee: All investor payments go directly into an escrow account linked to the government, which is specifically for that project, not the developer. The Dubai Land Department (DLD) controls and releases funds based on verifiable construction progress. Furthermore, before starting, the developer must deposit 30% of the total project value to guarantee delivery. If a project fails, the DLD steps in to finalize it or fully refund investors.
• Selecting the Right Assets: For the best performance, we recommend investors look for primary plan locations and, specifically, branded residences. These properties offer the best ROI, highest appreciation, and the highest velocity on resale.
• Boutique Developers: We noted the opportunity presented by boutique developers, such as Ellington or Select Group, who often focus on delivering exceptional quality and standard, giving them an advantage over larger entities.
3. Navigating the Acquisition Process
• The Power of the Consultant: We strongly advise working with a consultant (broker) rather than going directly to a sales agent or developer. Consultants work across the entire market, providing impartial guidance tailored to your specific investment purpose. On the primary market, 97% to 98% of deals are completed through brokerages.
• Expression of Interest (EOI): For highly sought-after projects, especially from top developers like Emaar, an EOI is required. This often prioritizes buyers who purchase full floors or multiple units. An EOI requires submitting money or a check to show seriousness and secures a place on the pre-launch or cancellation waiting list.
4. Why Dubai? Why Now?
• Visionary Leadership: Dubai's success is driven by the leadership’s vision, management, and commitment to keeping promises, achieving in 30 years what other nations took 100 years to accomplish.
• Safety and Lifestyle: Dubai offers exceptional personal safety, coupled with an unparalleled, versatile lifestyle where you can choose your desired environment (beach, metropolis, luxury community) within the same city.
• Infrastructure Commitment: Current initiatives, such as the Dubai 2040 project, the plan for 100 million mangroves, and infrastructural developments like the 91 km loop with AC coverage for walkers and cyclists, demonstrate a rapid and continuing commitment to growth.
We invite you to listen to the full episode with New Best Credit to gain a deeper understanding of how Couture Private Estates can help you navigate and optimize your investments in the Dubai market.
Link to podcast: https://www.youtube.com/watch?v=xSIXmav6RfY
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UAE Real Estate Podcast
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