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You must have heard about those real estate investors, who purchased some property at extremely low prices, in a relatively lackluster real estate market. Then for some reasons the property prices soared and the property owners earned huge profits in no time. They are some lucky guys? Aren’t they? But before you start envying them for being the fortune’s favorite, let’s get your facts straight. The fact of the matter is that it is the market analysis and foreseeing capability that makes the difference, more than luck or fortune. Real estate market plays an important role in the process of property valuation, even more than the property itself. Therefore, next time when you are about to invest in some residential or commercial property, spending some time in evaluating the market can make huge difference.

An overview of the market and economy:

Have a close look at the ongoing situation of real estate market; do you see a bullish or bearish trend? Do you think this trend is going to continue in coming days or there are some signs of change? The overall economy has a direct effect on real estate as well, if there is economic growth in some regions, real estate prices are supposed to grow as more and more people and businesses will step in to take advantage of the growing economy. If you can retain a residential or commercial property or even some vacant land in this region, it can bring huge yields. Projecting a bullish or bearish trend is not an easy task unless you have got the drift of economic ups and down. However, you can take help from some experts (though, they might get it wrong as well).

Vacancy rate, Rentals, Prices:

If you are looking for short term investment, where you wouldn’t have to wait for longer period before you start earning, then look for these indicators. Vacancy rate of a real estate market is obtained by dividing the unoccupied units to the total units available in the market. You can have an idea of the existing property prices and the possibility of rise or decline in rentals or property prices, in near future. A significant change in mortgage rate can also boost or reduce sales.  

You should also check for the infrastructure and development work going on in the real estate market and adjoining areas, in particular if some big companies have recently entered or left the market.

A condo is basically an apartment/flat owned by the occupier himself. The only difference between a condominium and apartment is probably the type of ownership; otherwise they’re both the same. Condominiums are owned by separate owners, while there are some commonly owned facilities like electric lifts, swimming pool, cooling system or car parking in the building. A condominium complex usually consists of many housing units and it is a norm in large metropolitans where residential land is scarce as compared to the inhabitants and their accommodation requirements.

A condominium is a very good choice for anybody who is looking for a house at considerably low rates as compared to separate housing units. Along with a place to live, you get the facilities like swimming pool, security and elevators. Not for free though as you’d have to pay a small fee irrespective of the actual usage or how much you need them (something you must consider when purchasing a condominium). Therefore the first thing must be to make a list of your requirements and then get yourself to search for a condominium building with the appropriate amenities. For example, if you are not really a fitness freak then probably you shouldn’t be paying for a modern gym in the building. If a residence is all you’re looking for, then you must search for a complex with minimum facilities like car parking and cooling system, etc.

Coming to the price factor, it’s particularly hard to decide the right price for a condominium. You can always take an expert advice (from some real estate agent or someone from your social circle). You can also take a look at the selling prices of the condominiums recently sold in the adjoining areas, and compare them with the prices in past to see if the prices are stable or increasing. Try not to buy a condominium at a time when prices seems to be going through an unnatural boost (also known as real estate bubble) because sooner or later these prices will decline sharply.

Another important thing is to do some research on the role and behavior of home owners association. Visit the complex yourself and ask the inhabitants about their experience, especially the issues they have to face so far regarding maintenance or other restrictions. Ask them if they had to pay some amount as “special assessment”. Last but not the least; do check all of the required documents to make sure that you are not dealing with some fraudulent party.

Source:
Dubai Property