Rent to own possible?

[Investor___]

Alright heres the deal...

I want to get a place in Dubai to go to on weekends and vacations ( i'm from a neighboring gulf country )

So I find out that rents are insanely high if you want a decent place.

So, I think, if i'm going to pay, say, 90-100k/year for rent I might as well pay that kind of money on a yearly basis and end up owning the place.

I check Interest rates ( Islamic ), and I find out that an apartment worth 900k would end up costing me around 1.9 mil. And i'd still have to pay that kind of money on a yearly basis for the next 15 years.

The projects that require you to pay 100k or so every three months I do not find convenient at all.

If I go on vacations and pay for short term housing i'll probably end up spending that kind of money or more.

So, any suggestions? Maybe theres something i'm overlooking?

[Greco]

ok.. you have two options here. It is true that interest rates within UAE are extremely high (over 8.5%) as a foreign investor and yes you do end up paying double of what the property is worth.

So your first option would be to look for an overseas loan, either from your home country either from other lending institutions. I took a "renovation" loan on one of my other properties in Europe and used that money to pay partially the Dubai property and the rest I coughed up in cash. If you do have the cash available, try and pay as much as you can in a serious downpayment to avoid paying interests to the Banks...

The second option is to buy in a development where short term rentals are allowed so that you can "block" so to say the time periods that you would like to use it yourself. Then the rest of the year the agency would be renting it out on short terms. Usually this method can bring you far more revenue than renting it out on a yearly basis but with 2 drawbacks : 1.Agencies charge high commission percentages for those type of rentals 2.Your place will be in need of renovation in a much shorter span of time.

The second option is still the most interesting one however ensure that in order to have high demand for short term rentals it has to be in a prime location! Either targeted to the Leisure market (mainly UK,Russia,Germany) so a place in Dubai Marina or Jumeira would make sense or targeted to the Business market were DIFC (Dubai International Fianance Center) or Business Bay would be your two prime locations.

[Investor___]

Thank you very much for your reply Greco. I appreciate it.

[fcrs]

Well there are so many other ways you can own a property in dubai city and pay your loan + stay in the best location in Dubai

Only you have to select the correct property which can give good returns i maybe can help you if you want, you can leave your email & contact # i will contact you ASAP

Thanks
Sameer