A Q&A with Dilip Daswani, a property investor and the director of Capitol Real Estate.
Looking for the right deal in a buyer's market
You have already bought four properties for investment in Dubai. What's stopping you from buying again right now? At the moment, all my cash is being used to keep the business afloat. Properties are cheap, but money is still a problem for most people as the banks aren't lending properly. But by the end of this year, I see things changing.
So when you do buy, where will you look? I would buy in Jumeirah Islands; it's an amazing piece of property, only 600 villas across a number of islands. Then there's Emirates Hills or Old Town, where it is easy to rent. Even for a villa on Palm Jumeirah, people are willing to pay the money for their own private beach and to be able to say they live there. If you invest in these areas, I can't see you going wrong.
Property buyers might be cautious right now, but what about the future? There are predominantly four groups of people who will bring the market back up: the Chinese, the Indians, the Pakistanis and the Iranians. They're the four groups of people who don't need mortgages. They have the cash and just want to buy in Dubai. But what about high-profile issues people have had with properties that are unfinished, such as Palm Jebel Ali?
I can sympathise with what they've been through. But you can say that about anything. For example, let's look at Lehman Brothers. They ripped the heart out of people all around the world, taking their whole retirement, which they won't get back. Tragedies like Lehman's have affected a lot more people than a bunch of villas on the Palm. Your company mainly deals with rental property - where are your clients coming from and what are they looking for?
They are not new people. They're those who are moving within the Emirates because Dubai is much cheaper now. People are looking for cheapest as possible; they basically want what could not have been got in the old days. Let's say it was Dh60,000 (US$16,335) per studio, well, now they want to pay that rate for a one or two-bedroom place, while studios in some areas are going for between Dh35,000 and Dh40,000.