Buying a property can be an entailing as well as financially rewarding process as long as one makes the right choice. Most of the population looks for home rentals to expand their portfolios; therefore, real estate is a very competitive business even with profit and earnings.
A first-time landlord has questions like what is referred to as how to have insight in a good rental real estate how to dodge bad ones, and what are the concerns of the area and property taxes. It will be reasonable in this context to disclose the potential advantages and potential disadvantages of the industry.
Here are some matters that one should consider before getting properties for rent in Dubai, Abu Dhabi, Sharjah, or even all over the UAE for investing
Choosing a property
Before getting fully immersed in the waters of investments, one must make certain decisions, the first one of them being the type of property that one is interested in. Investment in real estate has only one type of property that is especially suitable for novices and this is the single-family home type. They are likely to attract long-term residents who are ready to book the property and remain there for a long period.
Choose Real Estate Broker
It is necessary to choose a real estate broker to get properties for rent in Abu Dhabi or all over the UAE. It is a very crucial part of your business Because a broker has full responsibility to handle your property transaction. There are so many things to do like, get permission or NOC from some government institutes like EJAARI in UAE. So, a professional real estate broker is a very basic and compulsory thing to invest in rental properties in UAE.
Rates of Property Tax
It is wholesome to say that there exist geographical differences in the charge of property taxes. Homeowners existing in the local region can be consulted more on these prices or the prices can also be obtained from assessors’ offices in the municipality. Knowing what is at risk usually may be very wise when gambling. However, in a desirable community where the property has long-term occupant’s high property taxes may just be advantageous, but in the less desirable area, they act against you.
Neighborhood
Depending on the type of area you have invested in, the type of tenants that will be attracted to your property will be as follows. Before buying a house, ensure that the neighborhood meets some fundamental conditions
Job Market
Tenants are attracted to locations where employment opportunities are potentially rising. People working for big firms invariably seek a good home near their workplace in the region.
Schools/Universities
An important point here is that it is single-parent families, or university students for example who are the most likely tenants. Being local, it is important to consider the quality of the schools; a good local school or university will affect the returns of your investment.
Crime rate
You can be certain that no one harbors a desire to live in a society that is characterized by high crime rates. Learn the rate of theft and other small crimes before investing in a particular area. Are criminals on the increase or rather, do they exist in a decreasing number?
Amenities
Ensure that the property has many restaurants, parks, a fitness center, and public transport among other key attraction features that would attract more renters. Most tenants prefer comfortable accommodation and having these items nearby ensures the tenant is as comfortable as they need.
Future Developments
Here it is of relevance to discern the forms of development that shall be making the surroundings of the particular property that you wish to buy. Information about the measures that have been initiated on this aspect in the near region can be obtained from the local planning department. Buying real estate in a particular region that is steadily developing is often advisable since it affects other facets such as rent, property taxes, tenants, and so on.
Natural Disasters
Rising insurance costs might just mean that all your rental revenue is used to pay for insurance if your area is prone to earthquakes or flooding. You also need to know how much insurance will cost you because you have to subtract from your taxes the amount.
How is the depreciation on a rental property calculated?
That solution to this topic is not easy for me to provide because there are several ways that one could write depreciation on rental properties. It may be more appropriate if I give it to my accountant. However, to apply straight-line depreciation over 27 years period is to assume that a set of assets will remain pure and in its original form over the said duration. Of these three, the strategy of choosing 5 years as the longevity of the project is the most preferred. In other words, the property will be equally depreciable over a period of 27 years through a straight-line method. 5 years.
To arrive at the value thus, the cost basis, or the price at which you purchased the property, has to be divided by 27. 5. For example, when it comes to the house, you divide the $500,000 price that you paid by 27. 5. When doing the multiplication that gives a total of $18,181. 82, which is the amount of money that you are going to part with in taxes. It is important to know that the depreciation of the properties should be based on its original cost and not the current market price.
