# Becoming a landlord



## DavidRene (Jun 26, 2013)

I'm a French citizen looking to buy an apartment in Dubai as sort of an investment / possible home. Nothing fancy, I've been looking at studio apts. in Dubai Marina district, for about 650k-700k AED. 

I'm thinking of buying it and renting it out (not sure if I'll be living there for now). I do have some experience renting out my apartment in Paris, but I'm not sure how similar it would be in Dubai.

So does anyone have any experince with this?
The buying part:
Location, Marina or Downtown?
Agencies and their provisions?
Taxes, lawyers and property documentation charges?
Something specific to look out for?

The renting part:
Agencies; their provisions and reliability?
Maintenance if it's vacant? ... don't really want to fly to Dubai just to clean a toilet after tenants have left...
Taxes and property insurance? 
Service charges in buildings?
Which monthly expenses do the tentants pay and which would I have to?
How much of a hassle is it really?

Thanks


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## vantage (May 10, 2012)

my experience of property is that it is far easier to manage if you have multiple properties in one location.
Have you thought about adding to your Paris portfolio? Europe surely cannot go much further downhill, and it is likely that property will still be there in decades. Here - not so sure!

multiple properties in the same location gies you management efficiencies, better discounts with agents, insurers etc.

I despise renting, but i wouldn't buy here.


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## DavidRene (Jun 26, 2013)

Well, I'm not really looking at it as an investment portfolio, rather a second home to rent out. 

But, for this money you couldn't buy a shed on the outskirts of Paris and the rental yield in Paris is about 2% net. Not worth it at all.


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## Zidanechamp10 (Dec 10, 2013)

Hey I am interested in doing the same here in Dubai. How was your experience if you were able to buy and lease out the apartment?


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## Vasilis10 (Apr 13, 2013)

I am interested on the same thing guys, some information would be great. how much would be the profit on a monthly basis if lets say the apartment would cost 700k.


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## sammylou (Oct 29, 2012)

DavidRene said:


> Well, I'm not really looking at it as an investment portfolio, rather a second home to rent out.


one thing to note is that under current rules, you must give tenants 12 months notice to vacate if you wish to occupy the apartment yourself or rent out to another party.

and i believe that if you sign a standard one year lease with a renter you will be unable to occupy the place for two years as you would not be able to give the 12 months until the end of that first year's contract.

it makes it difficult to hold the property as a second home since you won't be able to use it without at least a year's planning ahead.

short term rentals here are not so common as many simply occupy serviced hotel apartments upon arrival. also, one cannot sign a tenancy agreement without the residency visa in place.


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## Vasilis10 (Apr 13, 2013)

Can someone tell me what are the extra costs a landlord must pay? (Are there any kind of yearly expenses?)


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## sammylou (Oct 29, 2012)

see notes in red



DavidRene said:


> I'm a French citizen looking to buy an apartment in Dubai as sort of an investment / possible home. Nothing fancy, I've been looking at studio apts. in Dubai Marina district, for about 650k-700k AED.
> 
> I'm thinking of buying it and renting it out (not sure if I'll be living there for now). I do have some experience renting out my apartment in Paris, but I'm not sure how similar it would be in Dubai.
> 
> ...


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## LongLiveDubai (Dec 1, 2011)

Vasilis10 said:


> Can someone tell me what are the extra costs a landlord must pay? (Are there any kind of yearly expenses?)


If you are buying a property, generally your costs will be as following: (as per current rules)

Transfer fee is 4% of the selling price + 540 dirhams.
Aed.4000 or Aed.2000 to be paid to a transfer trustee office, depending on the value of the property.
Commissions are generally 2 percent of the selling price.


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## BedouGirl (Sep 15, 2011)

LongLiveDubai said:


> If you are buying a property, generally your costs will be as following: (as per current rules) Transfer fee is 4% of the selling price + 540 dirhams. Aed.4000 or Aed.2000 to be paid to a transfer trustee office, depending on the value of the property. Commissions are generally 2 percent of the selling price.


I think there are also fees relating to cooling and service charges, depending on where you buy, the size of the property too. Not forgetting maintenance if the property is out of warranty.


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## Vasilis10 (Apr 13, 2013)

So guys please correct me if i am wrong but from what i understood if you have a small savings amount like 100-150k aed and you want to use it as a down payment for a small long-term investment (lets say a studio in jlt for extra rent income), by taking a mortgage from a bank you will also have to pay extra money monthly even though you rent the place for years to come till you pay it off in the bank.

Sorry for the confusion, just trying to clear those things in my head. After quick calculations you'd have to pay an extra 2k monthly even though the apartment is rented. Thats without any extra costs.


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## saraswat (Apr 28, 2012)

Also, just wanted to mention about the new mortgage rules for purchasing property in Dubai. I think they are already in effect or might be very soon, but I believe the maximum mortgage amount is 75% of value. Just something to also factor into the decision ...


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## saya123 (Dec 11, 2008)

BedouGirl said:


> I think there are also fees relating to cooling and service charges, depending on where you buy, the size of the property too. Not forgetting maintenance if the property is out of warranty.


cooling charges are based on consumption (to be paid by the tenant) and if they are not then they are built into the service charges the landlord pays to the developer.


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## Dubai here i come! (Aug 7, 2013)

Vasilis10 said:


> So guys please correct me if i am wrong but from what i understood if you have a small savings amount like 100-150k aed and you want to use it as a down payment for a small long-term investment (lets say a studio in jlt for extra rent income), by taking a mortgage from a bank you will also have to pay extra money monthly even though you rent the place for years to come till you pay it off in the bank.
> 
> Sorry for the confusion, just trying to clear those things in my head. After quick calculations you'd have to pay an extra 2k monthly even though the apartment is rented. Thats without any extra costs.


Hi Vasilis.... were you successfull. how was your experience.


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