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24 July, 2017
The UAE is a country that is appealing to many young people, in particular, those known as millennials. This is a generation of people who are tech savvy but do they know all there is to know about property investing and finance?
Property Ownership is lower
Despite earning a good wage, the number of people between the age of 18 and 36 who own a property in Dubai is lower than that of the global average. The figure is currently 26% which is significantly less than the 70% seen in China and 41% seen in France. The figures suggest that only 20% of millennials in the UAE seek finance from banks in order to purchase a property.
Challenges and Chances
Affordability is one reason why millennials hold back on purchasing property. They are required to put down a large deposit but saving for a deposit is also difficult. A 25% deposit is required for first time buyers purchasing a property under Dh5 million while it rises to 35% if a property is worth more.
However, things are changing and it looks as though self-employed young people are now purchasing high-end apartments while professionals are purchasing affordable property for sale in Dubai. As a result of reduced profit rates on finance for homes, more millennials are purchasing property while a decline in the speed at which house prices are rising is making it possible to purchase property.
Understanding what is Required
It is important that Millennials understand what they want when it comes to their plans for a career and their family so that they can select the best property for their plans. Younger people have a good idea about what they want when it comes to selecting a property as they often opt for the more modern and newest properties. It is also good to understand whether the asset will be used by them or as a property investment. Many couples below the age of 35 do not have a huge amount of savings and so they have to hold back from investing in a property that appeal to them as this could cause problems if they select a property that comes with problems.
Understanding policies and the Market
The government have made changes in order to cool the market down and so it is vital that people are aware of the policies. The Dubai Municipality has now dedicated land to affordable housing and so, for those looking to purchase, it is wise to keep an eye on these kinds of homes.
Financing a Property
When the time comes to purchase a property, then finance will have to be considered. For those who earn a regular wage, they will need to think about saving in order to put down a deposit and that means holding back on the luxury purchases.
In recent times, attitudes have changes and the younger generation are now willing to make decisions faster as well as carry out their own research and take advice from others. This means that banks understand the needs of millennial purchasers.
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