Scheme rent-to-buy support the property market in Dubai?

08.09.2011 07:18
Articles about real estate | Scheme rent-to-buy support the property market in Dubai? Scheme rent-to-buy (hire-purchase follow-up) in the UAE have been a popular way for buyers to become owners of real estate in the country. However, this opinion do not agree all the experts.

The largest developer in Abu Dhabi, the company Aldar Properties, this week launched a program for rent-to-own, allowing to purchase a house in a residential complex Raha Beach.

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The essence of this scheme is that the tenant within two years of making the developer a fixed rent. 100% of the rent for the first year of residence and 90% - for the second - and then can go to credit when you buy this object, says Arabian Business.

In addition, the tenant is under no obligation to buy and has the ability to transfer the accumulated amount of the other tenant, if he changed his mind to acquire a facility after two years of the lease.

According to experts, such schemes are gaining popularity in the UAE, because the tenants have a chance to become owners of real estate at the very moment when the market is unstable.

"An even more successful this program can be if developers will install the actual rents and prices for the sale of objects", - said Priesh Patel, Realtor of the company Aston Pearl Real Estate in Dubai.

Expert Comments

Tatiana Pyankova, Consultant, Emirates Dreams (Dubai)

"Similar schemes in Dubai, no. If someone agrees, and thus sell the apartment, then it happens in rare cases, and at the same price will be higher than if the same apartment sold for the entire payment at once. Builders in very rare cases offer schemes such as rent-to-buy. They do this in order to attract buyers. However, to my mind, Dubai was only one such case where an apartment in a residential complex proposed for this scheme: it was very remote and undeveloped area. In my opinion, this is an advertisement and a way to attract a buyer. "

Edward Buraks, real estate consultant company IMEX Real Estate.

"Most of the houses belong to private owners who are landlords. This scheme does not suit them. Apartments, owned by developers, in some cases, customers are offered under the scheme Rent-to-Buy, but it is not popular in Dubai as initial annual rent is much higher than the market and, consequently, the cost of the apartment, too. Thus, it is simply equal to the bank loan with the interest rate. According to preliminary calculations, the cost of such a scheme of apartments at nearly twice the market value "

Content tags: Overseas property
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