Miscellaneous Questions: Post them here

[stumbled]

Originally Posted by ameerj

Hello Guys


I am planning to buy a property in Dubai up to 500k, I am wondering if you guys( residents of IC) recommand IC, My job is in Knowledge village and i need to use the hous for my self,


Thanks in advanced.

I think the answer to your question is to ask one self why one needs to invest in a property and what they expect of it.

If it is yield then you need to take into account maintenance which is @10.5/sqft,agents fee which ranges from 5-10%, wear and tear of furniture, the fact that the gross yield for a 500k property is 10%(50k dhs) and once you minus these expenses the nett yield is about 6-7%, this is before taking into costs of travelling to and fro, agents fee ,completion costs and void periods.

If you don't live in Dubai you have to pay tax on your return earned in Dubai, so if you for example live in the UK that would be 20%. If it is borrowed money then you need to pay a mortgage which is about 7-9%, unless you have had a discounted rate. The interest ofcourse can be offset against your rent in your tax return.

In current market where IC projects are being completed they demand a premium, hence it is highly unlikely they will appreciate in capital for a while or substantially as they have already done so, more chances of it going down as the rentals don't cover the mortgage cost or due to over flooding of properties in the market and less people to rent.

With cash being the king and interest rates on the up in todays market earning from 6.4%in an offshore UK bank TO 8-9% on New Zealand dollar,i would put the cash in the bank and take a break from this property balloon.



These are just the basics , but i second kingpins suggestion that this forum has a wealth of information and I suggest you take your time and read them.

good luck!!

[Javaid Kamar]

With regard to putting money in New Zealand Dollars, it is definitely a risky proposition at the minute (unless you plan on living or working in New Zealand)

In the financial world there is something called the 'carry trade' which is the practice of borrowing money in a country/currency with low interest rates (today the Japanese Yen or Swiss Franc) and depositing it in a higher interest bearing currency such as the New Zealand Dollar (or GB pound for that matter).

The entire global financial system has been doing just this for the past few years and this massive flood of money into the New Zealand Dollar and for that matter the GB pound has been pushing the value of these currencies up, which has made the 'carry trade' even more profitable, since the value of debt devalued and the deposit appreciated relative to each other.

However this whole phenomenon has an element of a speculative bubble. The entire global financial system has placed huge bets on the carry trade and has thus far made handsome profits which it has used to drive up all manner of other asset prices. However, any major shock event could and probably would cause a massive stampede out of the carry trade (ie. a massive exodus out of currencies like the New Zealand Dollar and therefore a massive depreciation of these currencies).

This actually did happen in 1998. The Russian government defaulted on its external debt and this caused financial contagion, ie, widespead panic in the financial markets, leading to a massive stampede out of the carry trade. The US Dollar and GB Pound both lost more than 20% of their value against the Japanese Yen (which back then was also the major funding currency for the carry trade) in a matter of weeks. This caused major financial carnage and lead to the collapse of the celebrated LTCM hedge fund.

Only in the past few days, there have been reports of financial distress at investment funds linked to US sub-prime (ie. low end) mortgage lending market which a few people are saying could be the final trigger for the reversal of the carry trade, although it is utterly impossible to say whether it actually will be or not.

It is possible that New Zealand Dollars could keep climbing and the carry trade keeps chugging along and continues to make money for anyone depositing their money in New Zealand Dollars. But be weary. It could reverse at any time and blow up in your face at any point. And nobody really knows when and where that will be.

[ameerj]

Well




Thanks for the suggestions already made,

I live in Dubai, Currently pay about 5 k per month as rent, Been same for the last 4 years. that's why I am considering a mortgage and buying a house of my so I wouldn't be paying rent any more.

So considering the fact that I WANT TO BUY in dubai, Do you recommand a 500 k one bedroom in IC rather than a 500k small studio in ( for Inastance ) Discovery gardens?


Thanks

[aveshbachav]

Discovery Gardens has been a flop. I would suggest you to buy a one bed in IC or a new development in NEW Dubai like Marina or JLT. Even Jumeirah south village might be a good buy even sports city in DubaiLand. Even greens studio for 600K might not be that bad a buy but beware of high maintenance charges!!!

[KingPin]

Whatever you decide, make sure it is close to current or planned amenities or attractions. make sure that it is situated on a good public transport route. Also, it does not hurt if it the poorer brother of the bigger more expensive development next to it as living next to an iconic area is better than living a cab ride away. All this will help to still make it a desirable area when the time comes for you to sell and move into your villa.
These are considerations but not major concerns for those of us who purchased as soon as the project was launched as we have made a decent profit already.
You however, need to be more discerning as you are buying to live and work from. IC could be a good purchase, it even gives you the choice of facades. but it must not hinder your ability to enjoy Dubai because it is all you can afford at the moment. Sometimes, it is worth stretching yourself a little for a long term gain and immediatly better amenities. As you live there now and you are buying, spend a few weekends and go hunting for a home, but as the previous reply, make sure you know what the hidden costs are and factor those in also.
Good luck

[rizzpk]

I suggest you to buy 1 bed in International city.....

[wayneis]

Read what King Ping mentioned all the usual points for purchasing Real Estate apply however as you will be an owner occupier then it is worth mentioning rather than glossing over a few of the negative points of International City.

Location of the Sewage Facility
I would not buy in the Morocco Sector as its practically next door to the Sewage Plant as will be the Future developments located around the small Lake.
Lack of Public Transportation. There are some bus services however the Future train Line is many many years away.
Lack of Public Facilities, take a drive around International City and tell me how many shops you can find ( not counting Dragon Mart )
No Schools as promised in place. This would be an issue if you have children.
Lack of Parks, there is no allocated space, its a concrete jungle with the round abouts constituting the bulk of greenery.
There is a small man made lake which Nakheel say is home to 186 species of birds...take a drive down their and you can see mainly seagulls. Not sure where the other 185 species are hiding maybe its even too close to the Sewage Out let for the birds as well
There will be a future problem with lack of Parking Space once the complex becomes full. Huge oversight as when the shops are occupied downstairs in all the building's on the Ground floors there are NO PARKING SPACES available on the street side !
Maintanence Charges are ridiculously High for what is provided.
Construction will be ongoing for several years
Who Knows what will become of the planned Forbidden City in the center, its still an ugly pile of dirt with no sign of any construction taking place.
You now have many developers in Dubai offering more affordable housing along with more favorable purchase/ lending options so if you can wait out a few more years you could save your self considerable funds by looking at these options. ( Just up the road from International City you have Dubai Silicon Oasis and further up the massive Dubai Land Project )
Nakheel have not had a good track record in passing on timely and accurate information regarding handover of apartments in international city, just do a search on this web board to read the many legitimate complaints. Nakheel are trying to deal with these issues however they have bitten off more than they can chew and priority wise I.C. rates pretty low down the palm Tree as far as the Mega projects go. This would explain why when you visit the Nakheel Home page you see no mention Of I.C. until you click on the side web links.
Capital Gain from International City will improve once the project is fully completed.

Steer away from Discovery Gardens it is a flop.
International City at present is around the best buy for bucks however you need to be aware of few of the negative points that were mentioned above.

You have to do your own home work and work out if the Positives out way the negatives and suit your budget , lifestyle objectives and goals when it comes to investing in an owner occupied apartment.

Good Luck.

[ATA]

Originally Posted by wayneis

International City at present is around the best buy for bucks however you need to be aware of few of the negative points that were mentioned above.

Totally agree that apartments in IC are best value for money in Dubai currently.

[KingPin]

Originally Posted by wayneis

Read what King Ping mentioned all the usual points for purchasing Real Estate apply however as you will be an owner occupier then it is worth mentioning rather than glossing over a few of the negative points of International City.

Location of the Sewage Facility
I would not buy in the Morocco Sector as its practically next door to the Sewage Plant as will be the Future developments located around the small Lake.
Lack of Public Transportation. There are some bus services however the Future train Line is many many years away.
Lack of Public Facilities, take a drive around International City and tell me how many shops you can find ( not counting Dragon Mart )
No Schools as promised in place. This would be an issue if you have children.
Lack of Parks, there is no allocated space, its a concrete jungle with the round abouts constituting the bulk of greenery.
There is a small man made lake which Nakheel say is home to 186 species of birds...take a drive down their and you can see mainly seagulls. Not sure where the other 185 species are hiding maybe its even too close to the Sewage Out let for the birds as well
There will be a future problem with lack of Parking Space once the complex becomes full. Huge oversight as when the shops are occupied downstairs in all the building's on the Ground floors there are NO PARKING SPACES available on the street side !
Maintanence Charges are ridiculously High for what is provided.
Construction will be ongoing for several years
Who Knows what will become of the planned Forbidden City in the center, its still an ugly pile of dirt with no sign of any construction taking place.
You now have many developers in Dubai offering more affordable housing along with more favorable purchase/ lending options so if you can wait out a few more years you could save your self considerable funds by looking at these options. ( Just up the road from International City you have Dubai Silicon Oasis and further up the massive Dubai Land Project )
Nakheel have not had a good track record in passing on timely and accurate information regarding handover of apartments in international city, just do a search on this web board to read the many legitimate complaints. Nakheel are trying to deal with these issues however they have bitten off more than they can chew and priority wise I.C. rates pretty low down the palm Tree as far as the Mega projects go. This would explain why when you visit the Nakheel Home page you see no mention Of I.C. until you click on the side web links.
Capital Gain from International City will improve once the project is fully completed.

Steer away from Discovery Gardens it is a flop.
International City at present is around the best buy for bucks however you need to be aware of few of the negative points that were mentioned above.

You have to do your own home work and work out if the Positives out way the negatives and suit your budget , lifestyle objectives and goals when it comes to investing in an owner occupied apartment.

Good Luck.

Dude,

It's KingPin not King Ping, I have no IP address. I do agree with you though, there are bad sides to IC and they are due to bad planning. But once, it is completed, it should be a good place to live at the price. This could still take upto another five years though and the maintainance charges are a little on the greedy side. Also, I keep hearing conflicting information from all over. When I was originally marketed IC Spain, they told me it was next to the park, there is'nt one? I was also told there would not be a health club or swimming pool facilites, there is one?
They told me my apartment had a roof, it hasn't?

[stumbled]

Some have said if you like karama and can live there then this is a possible karama part 2, with cheap shops,cheap shopping, cheap housing.........and no parking