The real estate market in Dubai is ever-changing. New projects, districts and investment plans are coming to life every day. If you want, e.g. apartments for sale in Dubai Creek Harbour, there is nothing more simple than address one of the brokers and start a purchasing process right now (we suggest you use help of the Ax Capital agency for that). Now the new trend has appeared and that is crowdfunding. Some say, it is our inevitable future, some argue that it is just a passing trend. We’ll see what will happen in the next couple of years, but for now let’s have a look at what it means and how it has already been working now.
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Crowdfunding investments in real estate in Dubai
Dubai real estate market experts note the market’s readiness to abandon outdated forms of ownership, e.g, if there is a general interest on the part of developer companies and investors in joint ownership of residential properties, it will be able to bring good profit to both parties. At present, many agree that it is better for several financiers to immediately become owners of one property than to expect it to be bought by one investor.
One of the major developers announced the introduction of a crowdfunding or partial property ownership system in its Jumeirah Village Circle residential complex, in which investors can become owners of a part of the property for AED 5,000 or USD 1,360. As a result, several financiers will become owners of personal real estate.
It is noted that soon one of the developers, registered in the free zone of the Dubai International Financial Center, will offer investors a shared ownership of property for AED 2,000, or USD 544. Since many financiers today are interested in investments with minimal risk for themselves, and the division of ownership into shares reduces risks and allows investors to diversify and protect their investment portfolio from any downturn in the market.
The developer company plans to buy ready-made dwellings with a view to selling them to financiers in the future. According to experts, there is still a demand from developers for off-plan housings in the market, however, many, having an unsuccessful investment experience, are quite careful in choosing such projects. Because, such facilities have recently experienced many problems due to delayed commissioning, poor quality of construction work and unfinished amenities.
Investor readiness
Recently, the use of crowdfunding has been suggested as one of the options in order to attract many financiers. The bottom line is that collective investment does not require large financial costs, and for little money you can become the owner of Dubai property. At the same time, you can earn rental income even at low costs.
It is noted that crowdfunding is not yet used by investors in the Dubai housing market. But many experts are sure that at present the use of crowdfunding will be a way out of this situation. In addition, one of the largest developers announced a deal with a digital platform for the sale of real estate to investors, who can now become participants in a collective investment for AED 5,000 when buying apartments in the Eaton Place complex owned by the developer.
Experts note that crowdfunding in the property market in the UAE is still considered an innovation, so it will take a lot of time to implement it. At the same time, an increase in the number of financiers wishing to purchase real estate in the UAE has been recorded, and at the same time, developers are showing interest in changing the market.
The digital platform provides an opportunity for investors and buyers to purchase real estate or invest from anywhere in the world. At the same time, developers using the platform can divide real estate into parts and sell it remotely. In addition, financiers and buyers can also sell their homes and real estate shares to third parties using the platform.
Legislation in Dubai
The Government, in an official statement, announced the issuance of “full-fledged documents of ownership of housing shares, which guarantees the rights of investors in partial ownership of property. “
It is worth noting that for collective investments or crowdfunding, developers choose the best areas where rentals are in high demand and with a capital gains factor in the long term. Therefore, investing in the city’s property market can be a lucrative business if crowdfunding is properly applied and utilized.
SmartCrowd
Real estate in Dubai is a unique asset. You do not need to be a professional investor to find investment options and generate income. First of all, thanks to the rapidly rising prices for any kind of dwellings. However, the city offers a wealth of real estate investment opportunities, allowing investors to greatly simplify the process of creating an investment portfolio.
One solution is a crowdsourcing platform called SmartCrowd. According to the CEO of the platform, Siddiq Farid, today many novice financiers cannot determine the optimal time to enter the market. Many fear that the Dubai real estate market will start to decline after such a long period of growth. However, current trends show a rapid return to the previous levels, which were recorded in 2014. Some facts about the platform:
- This platform allows any investor to access all asset classes – whether it is a full-fledged property or a share.
- In addition, the platform’s capabilities allow financiers to build a strong investment portfolio.
- According to experts, over the course of its activity (about 17 months), the crowdsourcing platform helped bring investors almost 40% of the profit.
Real estate agency in Dubai
Do you want to buy property in Dubai? Contact the market experts – specialists of the Ax Capital real estate agency. They will help you choose the best housings directly from developers and advice on all matters of property acquisition. The specialists will select the best housing investment solutions or select the top properties if you want to make the emirate your home.
