# Seeking First hand experience Not hear say on property purchase.



## expatwanna be (Oct 19, 2010)

Hi all 
This is my first ever forum post so bare with me while I run the learning roller coaster. I am an Aircraft Technician lane: currently in the how would you say "wait and see phase" of do I have a job or not? Had the interview wasn't completely happy with how that went did'nt get the job but they have me in mind for another position its a kind of wait watch this space kind of thing and as I'm fast learning nothing happens in hurry in the UAE unless your going to Jail. 
I'm looking for feed back on the Pro's and Con's of purchasing a apartment in Dubai as opposed to renting for 3 to 4 years? preferably from someone with first hand experience and not from just hear say........
It would be great if someone out there worked for GAL as I would like to pick your brains about the rental allowance.
Another question is I have been told that you can't get insurance cover for a car older than 7 years? Can someone clear that up? If this is the case can you still get third party property cover to cover the other guy? Thanks in advance 


:focus: Live Life to the Fullest Because This is Not a Dress Rehearsal for the Next!


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## dk75018 (Jan 1, 2010)

hey,

Too many queries in one post ....  anyways, will share the information with best of my knowledge .. 
here we go.. we will check 3 options.. buying property with your on money, buying with mortgage, renting.

All the analysis is based on following assumptions..

Apartment size : decent 2 bed room. approx 1200 sqft - 1400 Sqft.
Mortgage Tenure : 10 years : Standard rates calculated 
location : not exclusive but kind of prime locations. 

cost of buying a decent 2 bed apartment in dubai in CASH

One time expenses 
Price : 1.2 million 
Transfer charges : 2% RERA 
Brokerage : 2% if bought through Estate Agent 
Deposits : 3k to 5k 

to be paid annually 
Building maintenance : AED 15 K to 20 K 

>>>>>>
cost of buying a decent 2 bed apartment in dubai through Mortgage 
One time expenses 
Price : 240K (20% down Payment) 
Transfer charges : 2% RERA + 5k registration of mortgage 
Brokerage : 2% if bought through Estate Agent 
Deposits : 3k to 5k 

to be paid annually 
Building maintenance : AED 15 K to 20 K 
EMI : AED 11,600 PM assuming a 10 year mortgage 
Insurance : 5k 

total = AED 164,200 



Putting up your property on sale after 4 years.. expect some appreciation of 20% (being on higher side), as they are expecting some 100000 units to be delivered in next 18 months, in fact in past 2 years property market seems to be knowing only one direction.. thats south. 

you sale your property in AED 1.44 m 
gross profit 200 K (if you bought in cash) 
net profit excluding maintenance, other charges like RERA and Brokerage… 80K, if you comparing with interest then take it as you lived in dubai on interest. Your capital recovered. 
you will surely made some handsome earnings if you plan to stay or keep apartment for more then 5-6 years. even if you plan to migrate, you can leave your property for rental income... 

against Mortgage .. You will be in losses as interest on loan amount will eatup your profits and may be more.. not a good choice unless you looking forward to complete the loan tenure.

best option : dun sale your apartment, and leave it for rental income, which will take care of installments, few years down the road, it may prove to be a good investment.

Price of apartments :

Studio 190K to 500 K 
1 bed. 250k to 700K 
2 bed. 650k 1.2 m. 

Prices are based on locations.. 

follow the list .. cheapest to highest..

international City
Commercial Business district
Discovery Gardens
Motor City
Silicon Oasis
Qusias
Burdubai-Karama
Barsha
Greens
Shk Zayed Road
Executive towers
Jumeirah Lake towers
Marina-JBR
Down town - exclusive
palm jumeirah-exclusive

Rental : 

you pay only 80K -110k per annum for good locations like JLT, MARINA, Executive Towers, Down Town. 
45K to 60K for average locations : Bur Dubai, Ghusais, Barsha, Silicon Oasis.. Etc etc..	

Advantage : you can change your location every year .. lolz

Motor insurance : Why you worried about a 7 years older car??? are you planning to buy one??

well, third party is available for up to 10 years older car. BTW, study shows that average vehicle life in dubai is 5.6 years.. as only 10% cars are older then 10 years.  you can call it life style or automakers coming up with such fascinating models year after year.. that you can't resist yourself from changing your car by every 3rd or 4th year... 


lolzz... m gonna stop now, hope above information will satisfy some of your queries.

cheers...

Dinesh


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## Elphaba (Jan 24, 2008)

And bear in mind that due to continued oversupply the value of apartments is expected to fall further....


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## expatwanna be (Oct 19, 2010)

*Thanks Most Helpful*

Thanks that was far more information than I was expecting to receive and all very helpful.

Yes I intend to buy a car I dont know old as yet. I will be commuting to Abu Dahbi.
I think he safest option will be to rent for the first 12 months and have a look around get the feel for place and what the market is doing. I would be wanting to pay cash for an apartment. Not quite as high as the figure you suggested in your example. Prefer to keep it around the 800 to 900K mark. The company pays an accomadation allowance but I'm not sure as yet if an employee is still paid this if they purchase a place? Thats why I wanted to pick the brains of someone that worked for GAL. But thanks all the same Dinesh.







dk75018 said:


> hey,
> 
> Too many queries in one post ....  anyways, will share the information with best of my knowledge ..
> here we go.. we will check 3 options.. buying property with your on money, buying with mortgage, renting.
> ...


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## Andy Capp (Oct 5, 2008)

dk75018 said:


> Putting up your property on sale after 4 years.. expect some appreciation of 20%


You are having a laugh aren't you?

You work in Real Estate - that's very clear from your posts (or at least have a desire to push the real estate sector), you're living in cloud cuckoo land, 20% appreciation???

Reality check needed here....


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## Elphaba (Jan 24, 2008)

Andy Capp said:


> You are having a laugh aren't you?
> 
> You work in Real Estate - that's very clear from your posts (or at least have a desire to push the real estate sector), you're living in cloud cuckoo land, 20% appreciation???
> 
> Reality check needed here....


I agree. A dangerous thing to suggest that there are guaranteed returns. Especially as anyone who has been here a while and understands the market is expecting the value of apartments to fall further. In addition, taking into account current prices, current rents and all the ongoing costs, rental yields for apartments are nowhere near 8%.

-


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## dk75018 (Jan 1, 2010)

well, dun know which world you guys are living or what rent you guys are paying... but if you get a rent of 75K for an apartment which u bought in 900K ,, seems to be close to 7%-8% (as maintenance is paid by owner...... that's current situation.... 

all these are projections for 4 years down the road.. not today, FYI, Marina isn't left with tooo many buildings under construction.

if i follow your words and thoughts, i believe you guys are dreaming to find a 2 bed apartment in Marina in 45k - 50K ?????? you may find tin box/match box kinda thing but not 2 bed...


high hopes guys.... all the very best..

cheers!!


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## Andy Capp (Oct 5, 2008)

dk75018 said:


> well, dun know which world you guys are living or what rent you guys are paying... but if you get a rent of 75K for an apartment which u bought in 900K ,, seems to be close to 7%-8% (as maintenance is paid by owner...... that's current situation....
> 
> all these are projections for 4 years down the road.. not today, FYI, Marina isn't left with tooo many buildings under construction.
> 
> ...


What?????

Where on earth do either of us say we're looking for a 2 bed in marina for 45-50K?

Are you on drugs?


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## dk75018 (Jan 1, 2010)

Andy Capp said:


> You are having a laugh aren't you?
> 
> You work in Real Estate - that's very clear from your posts (or at least have a desire to push the real estate sector), you're living in cloud cuckoo land, 20% appreciation???
> 
> Reality check needed here....





lolzz. neither i work for real estate.. nor m planning to... its just the knowledge/information about the world you live in.. which comes by being out there and analyzing the real facts.. not by just reading 14" scree .. 

cheers!!


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## dk75018 (Jan 1, 2010)

Elphaba said:


> I agree. A dangerous thing to suggest that there are guaranteed returns. Especially as anyone who has been here a while and understands the market is expecting the value of apartments to fall further. In addition, taking into account current prices, current rents and all the ongoing costs, rental yields for apartments are nowhere near 8%.
> 
> -


if an apartment of 900K gets you a rental income of 75k-80K, you are close to betwneen 7% and 8% ...n that's current situation. 

So if you guys ain't dreaming to get 2 bed in 45K - 50K and understand the fact that Marina rents will remain at least at same level as not too much of supply left in that area, then projection seems to be right....


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## pamela0810 (Apr 5, 2010)

dk75018 said:


> lolzz. neither i work for real estate.. nor m planning to... its just the knowledge/information about the world you live in.. which comes by being out there and analyzing the real facts.. not by just reading 14" scree ..
> 
> cheers!!


You sure use your '14" screen' argument quite a bit. I suggest you stop analysing and start working on your spelling and grammar. 
If you do not have any sort of a real estate background, then you really aren't in the best position to give any advice as the OP has requested for first hand experience advice and not hear say, which is exactly what you seem to be doing.


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## Andy Capp (Oct 5, 2008)

pamela0810 said:


> You sure use your '14" screen' argument quite a bit. I suggest you stop analysing and start working on your spelling and grammar.
> If you do not have any sort of a real estate background, then you really aren't in the best position to give any advice as the OP has requested for first hand experience advice and not hear say, which is exactly what you seem to be doing.


We all know about men who brag about the size of their equipment...


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## vagtsio (Oct 12, 2008)

pamela0810 said:


> You sure use your '14" screen' argument quite a bit. I suggest you stop analysing and start working on your spelling and grammar.
> If you do not have any sort of a real estate background, then you really aren't in the best position to give any advice as the OP has requested for first hand experience advice and not hear say, which is exactly what you seem to be doing.


well said pamela0810 :clap2:


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## wandabug (Apr 22, 2010)

My 1st Hand experience of buying....
I have bought 2 apartments (cash) both in good locations and near to Metro.
1 bed in JLT bought off plan for 400k 5 years ago, it has gone way up and back down in value but currently sellable for around 600k, this year I received 72k rental (furnished) minus 6k service charges.
Studio apartment in The Marina bought for 600k 3 years ago, sellable now for 500k, rent received this year 52k minus 5k service charges. The rent in the first year was 100k, 2nd year was 70k.
If you do decide to buy and can pay cash get the most you can afford in the best areas. Be aware it may go down in value but you will not be paying out rent yourself while you are living in it. 
I am happy with my purchases, enjoy the tax free income I get from them, but do not consider it a long term investment due to quality of build here. I plan to sell both within the next 5 years.
Hope that helps.


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## hubbly_bubbly (Oct 17, 2010)

wandabug said:


> My 1st Hand experience of buying....
> I have bought 2 apartments (cash) both in good locations and near to Metro.
> 1 bed in JLT bought off plan for 400k 5 years ago, it has gone way up and back down in value but currently sellable for around 600k, this year I received 72k rental (furnished) minus 6k service charges.
> Studio apartment in The Marina bought for 600k 3 years ago, sellable now for 500k, rent received this year 52k minus 5k service charges. The rent in the first year was 100k, 2nd year was 70k.
> ...


Helps me. Thank you.


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## hubbly_bubbly (Oct 17, 2010)

Elphaba said:


> I agree. A dangerous thing to suggest that there are guaranteed returns. Especially as anyone who has been here a while and understands the market is expecting the value of apartments to fall further. In addition, taking into account current prices, current rents and all the ongoing costs, rental yields for apartments are nowhere near 8%.
> 
> -


Hi there,

Is anyone expecting any drastic changes to counter this? Like a change in residency law (3yr residency) or foreign ownership law?

Have read some noises being made through the likes of Gulf News etc but wondering how possible this may be? Oman has had a slight bounce back after changing their residency laws.

Wondering if it'll actually ever happen in Dubai?


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## wandabug (Apr 22, 2010)

You do not get 3 year residence permit by owning property in Dubai anymore, that has been abolished. If you own property over 1 million dhs. you can apply for a 6 month visit visa but it is costly. Without a residency visa you cannot own a car or hold a bank (cheque) account.


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## hubbly_bubbly (Oct 17, 2010)

wandabug said:


> You do not get 3 year residence permit by owning property in Dubai anymore, that has been abolished. If you own property over 1 million dhs. you can apply for a 6 month visit visa but it is costly. Without a residency visa you cannot own a car or hold a bank (cheque) account.


Ah. I had read that it may be changing. Well at least talk of it anyway and there's not much of that to go by. Still. One only hopes.

Dubai Residency: Possible Changes Ahead | Immigration Services, Immigration UAE, Moving to Dubai | Move One InMotion

And from talking with HSBC, it is possible get an account, albeit through HSBC International, which is a foot in the door until you get all the other required doc's to start your life. Although unfortunately, you also need to be a HSBC Premier Account holder.

If you have/want a mortgage you may be eligible for Premier status. All the strings are attached though.

International Premier bank experience - HSBC Premier

With you on the residency, car and bank account otherwise. Very true.

Thanks.


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## pamela0810 (Apr 5, 2010)

Relax. No one's being territorial. You seem to be providing misleading information, that's all.
And it's "don't" not "dun". I find it quite annoying when grown people can't spell.


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## expatwanna be (Oct 19, 2010)

*Thanks Wandabug*

Thanks that also helps very much and I see it also heped someone else. I see I also started a bit of a stoush. Remind me not to upset anyone on here. I wasn't going into this topic with my eyes closed guys and least dk75018 did identify the fact that they were in investment type industry. Thanks to all. Tony.



wandabug said:


> My 1st Hand experience of buying....
> I have bought 2 apartments (cash) both in good locations and near to Metro.
> 1 bed in JLT bought off plan for 400k 5 years ago, it has gone way up and back down in value but currently sellable for around 600k, this year I received 72k rental (furnished) minus 6k service charges.
> Studio apartment in The Marina bought for 600k 3 years ago, sellable now for 500k, rent received this year 52k minus 5k service charges. The rent in the first year was 100k, 2nd year was 70k.
> ...


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## hubbly_bubbly (Oct 17, 2010)

expatwanna be said:


> Thanks that also helps very much and I see it also heped someone else. I see I also started a bit of a stoush. Remind me not to upset anyone on here. I wasn't going into this topic with my eyes closed guys and least dk75018 did identify the fact that they were in investment type industry. Thanks to all. Tony.


You don't learn by reading books, you learn by discussing them. Better a stoush than nothing at all.

Read in another thread that you will be renting for a year. Are you planning to buy as well?


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## expatwanna be (Oct 19, 2010)

*Yes thinking of buying 2brm Apartment*



hubbly_bubbly said:


> You don't learn by reading books, you learn by discussing them. Better a stoush than nothing at all.
> 
> Read in another thread that you will be renting for a year. Are you planning to buy as well?


Hubbly Bubbly yeah I hate paying rent its just dead money I read you're looking for a larger villa type place.? You're a camera man for a U.S. crew I guess you get around and see a few sights? I have friends in place living in JLT so I guess I will end up there for 12 months while I get a feel for the place. (Still waiting on a contract in the mail) so I don't want to get ahead of myself. I have friends paying around 100k a year for a fully serviced apartment, they are please with the arrangement as it includes all utilities etc phone,power tv internet etc. But to me its still 25 to 27k Aussie a year that could be put into an investment rather than dead money. I figured (using round figures) if I purchased a modest 2 Brm apartment for around 200k Aussie (Cash)and I'm there for 4 years and I sell it when I leave for a 50k aussie loss then I'm still 50k in front of renting for 4 years? a little bit harder work but benefits out way the hassles. And that if you sell at a loss. It does sound like there is a large over supply of units. I was there this time last year on holiday and the construction is mad.

:juggle:Live Life to the Fullest as this is not a dress rehearsal for the next!


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## Mr Rossi (May 16, 2009)

expatwanna be said:


> paying rent its just dead money


Less of a truism when you are a visitor to a third world dictatorship.


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## hubbly_bubbly (Oct 17, 2010)

expatwanna be said:


> Hubbly Bubbly yeah I hate paying rent its just dead money I read you're looking for a larger villa type place.? You're a camera man for a U.S. crew I guess you get around and see a few sights? I have friends in place living in JLT so I guess I will end up there for 12 months while I get a feel for the place. (Still waiting on a contract in the mail) so I don't want to get ahead of myself. I have friends paying around 100k a year for a fully serviced apartment, they are please with the arrangement as it includes all utilities etc phone,power tv internet etc. But to me its still 25 to 27k Aussie a year that could be put into an investment rather than dead money. I figured (using round figures) if I purchased a modest 2 Brm apartment for around 200k Aussie (Cash)and I'm there for 4 years and I sell it when I leave for a 50k aussie loss then I'm still 50k in front of renting for 4 years? a little bit harder work but benefits out way the hassles. And that if you sell at a loss. It does sound like there is a large over supply of units. I was there this time last year on holiday and the construction is mad.
> 
> :juggle:Live Life to the Fullest as this is not a dress rehearsal for the next!


Here's a link to a calculator page that sort of covers all those questions when it comes down to affordability. (Btw, friendly tip: the expats here like it when we use AED as too many currencies to calculate when doing the math, especially when it may not be their currency either. But I'm with you on the Oz dollar.)

Mortgage Rates and Mortgage Calculator

Remember that you have a lot more out-goings when you own. There are a few threads on this site that cover that too apparently. I'm just not up on that one for apartments.

Maybe you should also look at buying at home before you leave. That's a good deposit you have there. Then rent it out. I thought that it's also possible at the moment to get up to 7% for long term deposits. Maybe get some money back that way (from paying rent in Dubai) for the first year. Talk with your accountant to see about transferring the interest out of Oz and being non-res tax.

Hope this helps.


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## expatwanna be (Oct 19, 2010)

*Thanks Hubbly Bubbly*



hubbly_bubbly said:


> Here's a link to a calculator page that sort of covers all those questions when it comes down to affordability. (Btw, friendly tip: the expats here like it when we use AED as too many currencies to calculate when doing the math, especially when it may not be their currency either. But I'm with you on the Oz dollar.)
> 
> Mortgage Rates and Mortgage Calculator
> 
> ...


I hadn't thought about that tax issue. Are you sure the interest can be transfered out of the country in that way? I have read up on the Non resident bit but i diidn't think qualifying as a non resident would effect other income being generated in Aussie while I'm abroad. i.e. two rental properties, I thought I would just have to submit a tax return on them when I'm back in country on holidays. Your right I do need to have a long discussion with my accountant. And hey thanks for the heads up on the currency Jargon I'll try to speak in UAE dollars (still trying to get my head aound the large figures) Cheers.

:focus:Live Life to the Fullest as this is not a dress rehearsal for the next!


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## hubbly_bubbly (Oct 17, 2010)

expatwanna be said:


> I hadn't thought about that tax issue. Are you sure the interest can be transfered out of the country in that way? I have read up on the Non resident bit but i diidn't think qualifying as a non resident would effect other income being generated in Aussie while I'm abroad. i.e. two rental properties, I thought I would just have to submit a tax return on them when I'm back in country on holidays. Your right I do need to have a long discussion with my accountant. And hey thanks for the heads up on the currency Jargon I'll try to speak in UAE dollars (still trying to get my head aound the large figures) Cheers.
> 
> :focus:Live Life to the Fullest as this is not a dress rehearsal for the next!


Interest/rent etc is income and the ATO loves income. Same sort of issues in the UK I believe. Anyway, there may be rebates or different tax thresholds if you are non-res. Yes, check with your accountant and also for any "earnings" that you bring back into the country too. They love money coming in and hate it going out. But if you cover all the bases you should be ok.

No worries on the millions of goo-goos. They're actually called dinars. 

Best of luck.


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## Elphaba (Jan 24, 2008)

expatwanna be said:


> I hadn't thought about that tax issue. Are you sure the interest can be transfered out of the country in that way? I have read up on the Non resident bit but i diidn't think qualifying as a non resident would effect other income being generated in Aussie while I'm abroad. i.e. two rental properties, I thought I would just have to submit a tax return on them when I'm back in country on holidays. Your right I do need to have a long discussion with my accountant. And hey thanks for the heads up on the currency Jargon I'll try to speak in UAE dollars (still trying to get my head aound the large figures) Cheers.
> 
> :focus:Live Life to the Fullest as this is not a dress rehearsal for the next!


Note that the local currency is UAE Dirhams. This is written as either AED or Dhs. Please use local currency on the forum as posters are from all over the world and cannot be expected to do the conversions if you use other currencies.

Thank you


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## hubbly_bubbly (Oct 17, 2010)

Elphaba said:


> Note that the local currency is UAE Dirhams. This is written as either AED or Dhs. Please use local currency on the forum as posters are from all over the world and cannot be expected to do the conversions if you use other currencies.
> 
> Thank you


Oops. My bad. Dirhams, not dinars. My wife is Jordanian but I am getting old. Thanks, Elphaba.


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## Elphaba (Jan 24, 2008)

hubbly_bubbly said:


> Oops. My bad. Dirhams, not dinars. My wife is Jordanian but I am getting old. Thanks, Elphaba.


It's not a hanging offence...


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## hubbly_bubbly (Oct 17, 2010)

Elphaba said:


> It's not a hanging offence...


True, true. Could be worse.

Elphaba, a question and request please, if you don't mind? How's December for arranging meetings with the legal establishments re buying a resale property? We are trying to get two weeks for the trip but may only be one and was thinking that a lot of the right people might exodus Dubai for the winter/festive period?

If you have any direct suggestions for said profession, even if they are only for a "meet and greet" to setup our move for next year, would be most appreciative. Our needs are for contract review and other basic law services, checking wills against UAE law etc (my job is rather hazardous). I saw the link from your own link. Is this a good a place as any to start?

Thanks.


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## Elphaba (Jan 24, 2008)

hubbly_bubbly said:


> True, true. Could be worse.
> 
> Elphaba, a question and request please, if you don't mind? How's December for arranging meetings with the legal establishments re buying a resale property? We are trying to get two weeks for the trip but may only be one and was thinking that a lot of the right people might exodus Dubai for the winter/festive period?
> 
> ...



December is pretty much a standard working month here, although a few expats go home for the holidays.

You'll find useful info on the said link - look for the general guidance for Brits section in particular. Then PM me.


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## Jynxgirl (Nov 27, 2009)

I had just gotten here in Nov and my visa wasnt processed on time, in fact they returned it to our company because gov office that did that was closed for a week. ??? Do gov offices take off a long duration for their holiday?


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## Archiespice (Oct 27, 2010)

Hey Guys,
Have been reading your post. If anyone is looking to buy or rent a property in Dubai, do let me know. will help u.
chao


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## MONAE (Jul 9, 2010)

*seems right*



dk75018 said:


> hey,
> 
> Too many queries in one post ....  anyways, will share the information with best of my knowledge ..
> here we go.. we will check 3 options.. buying property with your on money, buying with mortgage, renting.
> ...


I think this seems about right......but there are lots of better investments out there .....it's a global village.I would'nt tie up my money in Dubai unless I were going to stay here long term.:juggle:


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## Elphaba (Jan 24, 2008)

If anyone was paying attention to local news last week they would have heard that property prices have fallen this year and are expected to fall further still.

I hate to say _I told you so_, but...

:wink:


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