The 5 Mistakes New Property Investors Make and How to Avoid Them

With all the financial benefits of real estate in Dubai, including high rental yields, investor-friendly policies, and incredibly high and growing demand, it's no surprise to see new investors jumping at the chance to make money by securing a property in Dubai. While the market is really promising, there are still many tricks to learn when it comes to investing in properties, and if you don't understand, you can get caught in a web fast.

These are small mistakes that even professionals can make, but most of the time, it's the new investors who get caught in these when they can be easily avoided. These missteps may not seem like a big deal, but they cost time and money and just cause unnecessary stress.

The price that you purchase the property at is simply one of many other expenses that will add up, there are registration fees, service charges, maybe you need to renovate, and there are also times when the property will be vacant, all of these factors will cost you and start eating into your profits.

We want to avoid this so it's important to keep up with all these costs, whether it's upfront or ongoing, this will allow you to see how well you're doing in the present and even allow you to predict what the numbers will look like in the future to help you understand how good the returns are and if the investment is working or not.

If you talk to some new investors and ask them how much they spent on certain properties, the numbers will shock you and confuse you. These numbers were not it, they are not worth it, and many times people don't bother to look at their options and just look at all other facts instead of price, while they could have gotten a better deal for a similar property, they didn't bother to explore.

To avoid this mistake, always look at properties with similar features and amenities to what you are looking for, the location, and all factors and price check; it's important to understand whether or not the price is justified. If there are better options available at a lower price, then chances are that the high price is not worth it; it's overpriced.

It's highly important to do research on the developer that's selling these properties, and look at their records; you might be surprised by what you find. If the company is a big name and is making a development, it's for a reason; it's a good name, but a good name only matters when a development is finished, not in the making. How successful were their older projects?

Also, check how well their properties are doing in terms of appreciated values, maybe a 30% increase may seem like a great deal at first glance, but if it's a new up and coming development and the other properties in the area have a much higher appreciation rate then it kind of puts things into perspective. Understand the big picture, add some context, and don't just look at the surface.

Another problem when looking at properties, especially off-plan properties, is that since the project is still in the works, there are times when construction can be delayed. This is pretty common for the most part, but sometimes too many delays or delays that are too long can get in your way, especially if you're planning on renting or you want to sell further. The longer it takes to be made, the more money that is coming out of your pocket.

If you see a frequent pattern of delay, or the developer is leading you on, meaning they say one thing but keep doing another, it's a big issue. You need to, again, look into their past and make sure the developers have a good record of getting things done on time.

There are all types of investment opportunities in the Dubai real estate sector, whether it's the secondary market or off-plan property buying. There are times when some investments do better than others, the economy is unpredictable, and it's better to place your bets on more than one area. Don't let all your investments be the same; spread out a little.

There may be times when the economy is on a high rise and everyone is looking for more commercial investments to take off, or looking to buy more luxurious villas. There will also be bad times, the economy can also suddenly crash, and people may be more inclined towards buying something that is more modest. With this, if one area of the market is doing poorly, you can at least rest knowing that not all your money is in the same place, so even if you do face some loss, it's not the same as losing all your money, and your other profits may make up for it.

You may be new, but you need to be smart too, look at things strategically, and have a vision in mind. Before you dive right into buying, know what you want and what you can get, what your goal is, what you want to do with the property, what your budget is, how you want out of the asset, and who you want to sell to. These are all questions you need to ask yourself. Investing is not as easy as it seems, it's not just about throwing in money to get more money out, It's about how you sell. Just posting ads and expecting a list of buyers is far from a long stretch; you need to build a network. A broker who is good at their job knows what types of properties their clients want, and they're the ones who push them towards these properties. It's important to build connections.

Just because you know what you want doesn't mean you know what's best for you. It may be hard to hear, but some people let their ego get in the way instead of listening to advice. Many people have been doing what you're starting for years; they know the ins and outs. You may think you know a lot, but there have been brokers who have been buying and selling properties to their clients daily for years. If someone is giving expert advice, consider it.