Things To Know Before Investing: To Own A House Or To Own A Flat In Dubai

Own A Flat In Dubai

Things To Know Before Investing: To Own A House Or To Own A Flat In Dubai

When it comes to investing in Dubai and facing the century-old debate of owning houses vs owning a flat in Dubai there is always someone with something to say. One believes that houses are advantageous as a solid investment due to many reasons such as having to do away with the whole maintenance cost or even the closeness of their own quarters to the tenants being a turn off to own a flat in Dubai.

If regarding a lease, some investors believe that the flats should be given back once the lease is over hence flats are a wasting asset. Another one would believe that to own a flat in Dubai is a better investment as they most of the time have more yields and require less maintenance since if leased, the freeholder gets to handle maintenance issues.

In this article, the different advantages and disadvantages of either choice would be outlined and the decision to choose a suitable one left with the investor.


Pros of flats for those who plan to own a flat in Dubai


Outlined below are some of the advantages that come with the choice to own a flat in Dubai:

  • The purchase price entry is a bit lower in comparison with the houses
  • For about two thirds the amount that would go on to getting a house, one could own a flat in Dubai
  • The flats have more yields and a more cash-cash returns compared to houses.
  • Flats are preferred by younger people who make a large percentage of the population compared to the elderly who prefer houses.
  • If leased, the maintenance cost is divided between the owner and the freeholder does the organization of the task.
  • To own a flat in Dubai from some of the management companies looking to quickly offload the flats could be cheap as they are probably not mortgageable but after fixing the flats, their values would undoubtedly increase.
  • In investing, it is preferred for investors to rack up their portfolio and buying flats is cheaper hence easy to build a portfolio.
  • It is easy to avoid loses by opting to spread risks in situations where the flats do not get tenants.
  • By opting to purchase in bulk, it is easier to get bigger discounts to those who want to own a flat in Dubai.
  • In town areas, the flats are in higher demand making their prices increase significantly
  • Renovating of a flat is quite easy hence one could increase a bedroom space by bringing down a wall making the dream to own a flat in Dubai a reality.


Cons of getting own a flat in Dubai


Despite the numerous advantages, there also exist disadvantages to own a flat in Dubai and some are outlined below:

  • The amount in terms of service charges as well as ground rent is high for some.
  • Compared to houses, flats have smaller living spaces.
  • It is harder for flats than houses to qualify for financing for some LTV’s and flats making some of the lenders view the flats as riskier investments to investors and those planning to own a flat in Dubai.
  • Although quite satisfactory, adding the loft space or converting one in a flat requires consent of the property management company making the process cumbersome.
  • Everyone likes being unique and stand out but if the flat is in a block then it loses its wow factor.
  • The turnover of tenants is quite high which may be discouraging to those who want to own a flat in Dubai.
  • If  not cautious, the flat could turn out to be a burnout for finances due to hidden maintenance costs that were not taken into consideration.
  • If a lease is short term, then getting of finance is very hard.
  • The amount payable as ground rent may rise in due time.
  • The value of the flat may drop over time hence drastic measures such as paying to increase a lease may be taken.
  • Flats which rise high bring about a slow growth of capital resulting in nearly not mortgageable properties such as the blocks that have council high rise.
  • A lot of flats in a block destabilizes the supply and demand balance which leads to the creation of oversupply over a short period resulting in a low rental value or voids hence might be an issue to consider for those who plan to own a flat in Dubai.


Pros of owning a house compared to having to own a flat in Dubai

After discussing the advantages and disadvantages of owning flats, the same is discussed about houses below and may shed some light for those opting to own a flat in Dubai.:

  • Readily available finances for the single-family houses
  • Houses offer more privacy to buyers and even tenants compared to flats
  • They tend to attract the longer-term kind of tenants such as those families with children who would most likely want to maintain the house themselves in the future
  • Capital growth potential is higher
  • If deciding to develop or make changes to space such as converting or extending, they have much bigger spaces available compared to having to own a flat in Dubai.
  • Houses are always sought after by most buyers such as the investors and families
  • One could decide to buy a house and make changes to it such as converting it into a flat and either sell or opt for mortgage.



Cons of buying a house to let

  • The costs of start-up and investing are quite high.
  • The probability of having to get a shovel and other gardening tools to maintain the garden which is not present if one decides to own a flat in Dubai.
  • The interest costs are quite high as well as the stamp duty compared to the idea own a flat in Dubai.
  • If unoccupied, the house is more likely to witness vandalism which is not present in flats should one decide to own a flat in Dubai.
  • There are higher maintenance costs since the space is larger compared to having to own a flat in Dubai.
  • A low yield may result in a low cash-flow.


The decision to choose the favorable investment type is left with the investors. Either they would prefer to own a flat in Dubai or a house. If on the market for the latest and cheapest houses and those looking to own a flat in Dubai, head on to Déjà Vu Properties. We provide an updated listing and unlimited support for those looking for just a house or looking to own a flat in Dubai.


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