Customer Case Studies

Here are examples that show the type of customer currently purchasing property in Dubai and the processes they have followed.

Sara (UK) who wanted a Studio to rent out and for own use
David (Australia) who wanted a 3 bedroom villa for own use only
Simon (Ireland) who wanted to switch from Ajman to Dubai
Asif (Saudi Arabia) who wanted a 2-bed apartment for investment
Pradish (Canada) who wanted to switch from a Dubai off-plan
Adrian (France) who wanted a 2 bed apartment in Marina Area
Muhammad (UK) who wanted to become an Openshore Agent

Sara who wanted a Studio to rent our and for own use

Sara is in the UK and has been a regular visitor to Dubai since 2005, going there for holidays during Easter, most years. She had been looking to buy property in Dubai for a long time as many friends purchased property in Dubai. One of her friends had purchased with our help in 2006 and that is how she was aware of Openshore. She almost purchased in 2008 and at the time also considered purchasing in RAK and Ajman. However she wanted to buy in Dubai but the prices were too high at that time; and at the end of 2008, the financial crisis happened which created a great deal of uncertainty. She was glad she did not purchase then, as since then, prices have fallen by over 50%.

Recently she decided to look at the Dubai property market again and was surprised by the current prices. The same Dubai Studio which was priced at around AED 550K was now about AED 240K.

She asked Openshore for a full quotation but had difficulty raising all of the funds so she delayed her purchase by 2 months. She signed a reservation agreement for a Studio apartment, agreed the specification and price, and paid 10% deposit. About a week later a Studio was allocated to her and she signed the MOU sales and purchase agreement. Initially she had no plans to visit Dubai to see the property, but then suddenly decided to make a quick visit to Dubai over one weekend. One of the Openshore consultants showed her the property and she decided to proceed.

She could not stay in Dubai for the property transfer and arranged for Openshore to have a Power of Attorney to do the property transfer at Dubai Government Land Department. Our consultant helped her sort out the Power of Attorney. Whilst she was there she also opened a UAE bank account with on-line access so that she could manage it from the UK. The property was transferred to her name and was rented after 1 week for AED 24,000. We delivered the title deeds to her in the UK and her rental income is paid into her UAE bank account. She plans to allow Openshore to continue managing her property.

Sara thought that she could use her Studio herself for holidays and rent it out the rest of the time. However, as she was only spending 2 weeks per year in Dubai, Openshore advised that it would be financially better for her to leave the Studio rented out (and she could rent another herself for the 2 week periods).

David who wanted a 3 bedroom villa for own use

David is from Australia and is presently in Dubai. He had been looking at prices of Villas in Dubai over the past few years. Initially he was looking for investment but recently he had a long contract in Dubai and wanted to purchase the villa at the new reduced prices for use by himself and his young family.

One of David’s work colleagues had purchased a property with Openshore‘s help and had recommended us to David. He contacted Openshore whilst he was still in Australia to ask for advice and a quotation on a 3-bedroom villa in the Springs or Jumeirah areas of Dubai. Openshore gave him a quotation but also advised that unlike Studios and 1-bed apartments, Villa prices had not reached rock bottom and are still slowly falling; and that prices in 9 to 12 months may be up to 10% lower than current prices. David decided to rent a villa for 12 months and has asked Openshore to find him a good 3-bed villa in 12 months time. During this time, as he will have been resident in Dubai for over 6 months, he may also become eligible for a mortgage. Mortgages are not available for non-residents.

Simon who wanted to switch from Ajman to Dubai

Simon lives in Ireland. He bought a 1-bed 920 sqft apartment in Emirates City in Ajman for AED 480K in April 2008. He wanted to buy in Dubai but Dubai property was too expensive. A similar 1-bed apartment in Dubai was AED 800K at the time. He decided to purchase in Ajman and was pleased with the payment plan offered. This purchase was mainly an investment for him.

However, whilst Simon continued to make payments as per the payment plan, the developer did not start construction but simply promised that construction would start soon. The financial crisis at the end of 2008 further delayed the start of construction. By early 2009 Simon had already paid AED 185K and then stopped making any more payments until developer started construction. The developer never started construction and Simon is in dispute with them for a refund which they are refusing to make. Instead they are offering a switch to another off-plan apartment in Ajman, which may have similar risks. (Openshore advises customers not to agree to another offer from the original developer such as a switch to another off-plan, as this reduces the chances of any claim against original purchase).

Simon contacted Openshore and was offered a Switch to a Dubai Ready apartment. Openshore took all the details and provided a full quotation to Simon. We informed Simon that we would offer an immediate credit of AED 40,000 against a Dubai property at its current low price. In addition to this we would take over his claim against the Ajman developer. If and when we are successful in this, we would pay Simon 50% of the money recovered.

Simon had outstanding payment of AED 295K to make for his Ajman 1-bed apartment. Openshore confirmed that we could provide a better 1-bed in Dubai for less than the remaining amount and also pursue the claim. Thus he would end up with a BETTER, READY, property in DUBAI. His total payments would be under AED 480K (AED 185K already paid to Ajman developer and 290K to us). Openshore would also offer an 8% rental guarantee and rent this property at no extra cost to Simon. The 1-bed offered to Simon was selling for AED 800K in 2008 and was now priced at AED 335K.

Simon thought that this was a good deal but when he looked at his finances, he decided to downgrade to a ready Dubai Studio instead of a 1-bed apartment. He selected a Studio of 560 sq ft with a current price of AED 229K. He got an immediate credit of AED 40K and will get AED 90K when the claim is settled. The amount he ended up paying to Openshore was AED 189K. He did not want to visit Dubai and was provided all the information on his Studio in the Ireland. Openshore obtained a power of attorney from him in Ireland and arranged for the property to be transferred to his name. The property is currently rented out for AED 23K. Openshore will continue to update Simon on his property and also on the status of the Ajman claim.

Asif who wanted a 2-bed apartment for investment

Asif lives in UK but presently works in Saudi Arabia. He already has a Studio in Dubai Marina which he purchased in 2006. It is currently rented out. He purchased it for AED 350K and the price of the Studio went up to AED 750K. Now it has fallen back to about AED 340K which is below his purchase price. He intends to hold the property for about 5 years as he thinks prices will go back up again. Openshore agree with this view.

He realises that prices are now very low and he wanted to buy a 2-bed apartment for investment. He contacted Openshore whilst he was in Saudi Arabia. He felt comfortable in dealing with a UK registered company. Openshore offered him a large 2-bed apartment for AED 580K. However we did not offer a rental guarantee. We advised Asif that for investment and renting out, it would be better for him to purchase TWO 1-bed apartments. These would cost the same together, and the rent on these would be about AED 60K whereas the rent on the 2-bed would be AED 48K. Also we find it much easier to rent the 1-bedroom apartments and we offered him a rental guarantee on these.

Asif decided to go for the smaller apartments and in the end he actually purchased a 1-bed apartment and a Studio. He did not go to Dubai for the transfer and this was done by Openshore via a Power of Attorney. He signed the Power of Attorney when he was in the UK. However, since then he has been to Dubai and has seen his properties and is satisfied with them. Both are rented out. The Studio is rented for AED 21K and the 1-bed for AED 30K.

Asif intends to keep his properties for at least 5 years .We estimate that during this time the net rental alone would have paid for 50% of the property costs.

Pradish who wanted to switch from a Dubai off-plan

Pradish who lives in Canada, purchased an off-plan development in Sports City in 2008. He purchased a Studio apartment for AED 560K. He has paid 30% of the property price and the development is still under construction. The developer says that it will be ready end of next year but Pradish thinks that this may not happen as the developer has been wrong on many occasions before. The developer is demanding the next two payments which amount to another 168K AED.

Pradish contacted Openshore for advice. Openshore told him NOT to make any further payments for TWO main reasons.

Firstly, as he has only paid AED 168K, the amount of payment outstanding is still AED 392K. Even if his Studio was ready tomorrow and was rented out, it would only be worth about AED 260K. Thus the amount outstanding is more than the current value of the property.

Secondly, there is a real risk that despite him continuing with payments the development may never be handed over. This may still be the case even if he can see the building and developer is still proceeding with construction. It is still possible for various reasons for the development not to complete.

Following this advice Pradish stopped his next payment. He then asked Openshore about the details of the switch offer to a ready Dubai Studio.

Openshore looked at his details and advised that the chances of recovery are low whilst the developer continues with construction. However, if the developer stops, then there may be some scope for compensation and that we will take on his claim and monitor the situation. He was given a part credit against a ready Studio which enabled him to purchase the Studio for only AED 196K (only AED 28K more than he would have paid the off-plan developer in that payment which we advised him to stop). The Studio is now rented out for AED 21K. Pradish did not want to visit Dubai and was advised to arrange a Power of Attorney from Canada. In the end he decided to come to Dubai for 3 days, saw his property and arranged the Power of Attorney in Dubai. Openshore later transferred the Studio to him and we have since sent him the Title deeds.

Openshore will monitor the developer and if a claim is made and is successful, 50% (up to AED 84K) would be paid back to Pradish. If this is the case the Studio would have cost Pradish only AED 196K plus 84K = AED 280K. This is almost half of what Pradish agreed to pay the original developer in 2008. Even if there is no recovery he has still saved much money. Pradish is glad that the original developer did not complete the property on time.

Adrian who wanted a 2 bed apartment in Marina Area

Adrian lives in France. He has visited Dubai and stayed in the Marina area. He wanted to purchase a 2-bed apartment in this area mainly for investment although he may use it himself in 3 to 5 years time.

Adrian’s cousin had purchased and rented out a Studio with Openshore’s help. He contacted Openshore regarding this potential purchase. Openshore advised that prices in the Marina area whilst having fallen are still about 50% more than property inland. Paradoxically it is also harder to rent property in this area as the rental demand does seem to be seasonal. Rental yields are also lower at around 7% compared to 10% inland. Thus we were not able to give a rental guarantee on such an apartment. Thus unless this apartment was required for his own use now, it would not be the best form of investment in the current market.

Adrian thought he may live in Dubai in 3 to 5 years and particularly liked the Marina area. He actually ended up buying TWO 1-bed apartments inland for a much lower price than the 2-bed in the Marina. He intends to sell one or both of these in 3 to 5 years time and then get a 2-bed apartment in the Marina area. This is better strategy than buying it in the Marina area now.

Muhammad who wanted to become an Openshore Agent

Muhammad lives in the UK. He used to be a property agent for Damac in 2007. At the time he had considered becoming an Openshore agent but Damac offered better referral fees as their properties were much more expensive, so he stuck with Damac. Muhammad stopped recommending Dubai properties when the credit crunch happened at end of 2008.

Recently he contacted Openshore and indicated that at the present low prices many of his contacts would be interested in investing in Dubai once more, particularly if the properties were guaranteed to be rented and managed with reasonable returns.

Openshore does not use print advertising and relies mainly on referrals and recommendations from existing customers. We informed him that he could apply to become an agent after the sale of his first referral. At his first referral Openshore would pay him a referral fee of £200 or AED 1,200. After this he could become an agent and his referral fee would be much higher and there would be an additional bonus related to the number of properties sold in the previous quarter.

Openshore provided Muhammad with 10 printed brochures and he made his first sale within a week. He simply showed the brochures to some contacts and asked them to contact Openshore. He emailed the names of his contacts that were interested to refer@openshoreproperty.com. One of his contacts purchased as Studio apartment. We transferred the property to his customer via Power of Attorney. Since then Muhammad has become an Openshore agent and distributed about 100 brochures to his contacts and at the time of writing had made 3 more sales.