About Dubai - Real Estate in Dubai
Dubai opened its property market for the foreign capital 5 years ago, with the so-called freehold projects. So the foreign citizens and residents were among those, who can buy property in this Emirates.
Because we speak about projects under construction, the financing is scheduled. Part of the projects are in an initial phase, so if an investor buys a real estate now, he has the opportunity to buy with a low percentile inpayment (even with 10 percentages!).
Because of newly founded firms and mass immigration, there is a huge demand for housing in the real estate market. During the past years the country's population increased by 25%, thousands of firms were founded in all of the Emirates. Currently there is a huge shortage in flat and office areas, the already finished projects are rented out in 99%. The rental fees are rising from year to year.
The experiences are mixed worldwide with the projects before the handover. The investors are afraid, that the constructors are getting involved in material difficulties, and because of it the buildings are not going to be finished. This is unlikely to happen in Dubai, because of the limitation, which says that foreigners can only own properties in free zones. These free zone property areas are huge projects, which often reaches more billion dollars. The main developers, Nakheel, Sorouh, Aldar and Emaar are the world's largest and most authentic constructors. The developers' size and experience provide safety.
ESCROW account: the pawn of the safety
Escrow account: the money of the investors is protected by the law effective from 2007, when a so-called „Escrow” account was established in Dubai. The investors are paying the instalments of the property to this account, which is monitored by the state. The developer is entitled to withdraw from the account only to cover the costs of the construction. The transactions are checked by government auditors.