Question:
What are your thoughts on purchasing a property for Dh1 million ($272,260) with the expectation of reselling it for between Dh1.2 million and Dh1.5 million?
A developer launching multiple properties in the same area would increase supply, making more units available. Why should I buy now?
If the argument is that the same developer may raise prices to Dh1.5 million or Dh1.7 million in a few years, allowing me to resell for Dh1.3 million to Dh1.5 million by the time of handover, there must be a limit to how much prices can increase. A property that costs Dh1.5 million today is unlikely to be worth Dh5 million to Dh6 million in five to seven years.
What is your perspective on this?
Answer:
Investing in property with the sole expectation of a quick appreciation in value can be risky, as real estate markets typically do not experience rapid price inflation.
Property values tend to increase over extended periods rather than in short bursts, and multiple factors influence this appreciation. Your concern about increased inventory is valid, which is why investors should focus on properties that offer something unique.
When purchasing, aim to acquire a unit with distinguishing features that set it apart from others, making it more attractive when it’s time to sell. Investors who bought in the last three to four years, particularly during the post-pandemic period, have seen strong returns.
However, buying with the sole intention of flipping can be risky, especially if the investor cannot hold onto the unit for long enough or struggles to meet the payment plan milestones for an off-plan property. Many investors run into financial trouble when they fail to manage these commitments.
For those looking to invest with the goal of selling later, conducting thorough due diligence is essential.
Consider the unit’s location, the quality of the building, and available amenities. Evaluate the transport infrastructure—whether it is near a metro or tram station or has good road access. Assess nearby landmarks, tourist attractions, and the surrounding community. Does the property offer a good view? Are high-quality materials used? What is the reputation of the developer?
All these factors should be carefully analyzed, and if they meet expectations, purchasing within your budget can be a sound decision.
Dubai’s real estate market is currently on an upward trajectory, but caution is necessary since market fluctuations are inevitable. The question remains: when will the cycle shift? That is something no one can predict with certainty.
Question:
I’m dealing with an issue involving my landlord, which is a real estate agency, in Abu Dhabi. My tenancy began on March 10 last year and is set to end on March 9 this year.
On January 8, the agency emailed me to ask if I wanted to renew the contract. I responded on January 11, confirming my intention to renew.
On January 14, the agency informed me that the landlord planned to increase the rent by 5 per cent and sent me a renewal offer letter with a 14-day validity. On January 22, I signed and returned the renewal letter. However, on January 23, the agency emailed me stating they would not renew the contract and instructed me to vacate the property by March 9.
Since then, I have tried reaching out to the agency, but they have not responded.
I understand that Abu Dhabi law requires a two-month notice period for both rent increases and non-renewals. Given this, I believe I cannot be evicted, but my wife and I are feeling very stressed about the situation.
Are they legally allowed to refuse renewal without providing at least two months’ notice? How can I ensure my rights as a tenant are upheld?
Answer:
While landlords have the right to change their stance on certain matters, the law in Abu Dhabi is clear—two months’ notice is required for eviction. Despite the agency’s reversal, you are legally protected, provided you take the appropriate steps, such as filing a case at the rent dispute center.
At this stage, negotiating with the landlord remains the best course of action. While the law is in your favor, some landlords can be challenging, so resolving the issue through direct discussion is preferable to legal proceedings.
I recommend attempting to arrange a face-to-face meeting with the landlord to protect your rights. If this does not yield results, your next step would be to file a case at the rental dispute center. You can reach out to the Abu Dhabi Judicial Department at info@adjd.gov.ae for further assistance.
