The northern emirate has a lot to offer renters or homebuyers, and for a fraction of the amount of Abu Dhabi or Dubai.
Ras Al Khaimah a bargain paradise that is worth the move
After six months in Dubai, Krystina Babets moved to Ras Al Khaimah, enchanted by the natural beauty of an emirate that its residents often describe as a hidden gem. And she also reduced her rent by more than three-quarters.
“I really like the place. It is very peaceful. You can live on the beach in a nice atmosphere. It is not crowded and very cheap,” she says.
After her move, Ms Babets, a 26-year-old from Belarus, took a daily bus from RAK to Dubai to go to work. Another six months down the line, she tired of the commute and of Dubai’s buzzing lifestyle.
And so she decided to fully shift her life to tranquil RAK. “Usually people shape their life around their work and not the other way around,” she says.
But Ms Babets did it her own way, and with partners has started a tourism company in RAK’s free zone.
As property prices have surged in Dubai, many people have considered moving to RAK to enjoy a peaceful lifestyle at a lower price. Indeed RAK’s rents are now rising too, although from a much smaller base.
For many a first-time visitor, the emirate ranks as an utter surprise. Far from being a dusty hinterland, Ras Al Khaimah (its name means “the top of the tent” in Arabic) boasts a variety of landscapes. It has the waters of the Arabian Gulf on one side and the mountain range of Ru’us Al Jibal on the other.
A decade ago, the emirate inaugurated a massive transition with the building of Al Hamra Village, a residential and leisure development that includes a mall, restaurants, golf courses and hotels.
“Usually people come down by chance; a friend of a friend mentioned it. But then they can’t believe they can find this value for money,” says Annette Liechti, the sales operation and leasing manager at RAK Properties.
“Something that is clean, new, bright, breezy, sea-facing, nice life-style for this little investment or this little amount of money compared to Dubai,”
A sea-view studio in RAK costs an average of Dh20,000 a year. In Dubai a similar studio in Jumeirah Beach Residence (JBR) would cost Dh90,000, according to Dubizzle. Those prices are bang-on with what Ms Babets is paying in RAK, and was paying in Dubai.
Property prices in Dubai have surged. The IMF in July warned that house prices in the UAE were rising too quickly, increasing the risk of a new bubble. A Jones Lang LaSalle report said that house prices in Dubai rose by an average of 17.9 per cent over the year to the end of August.
Ms Liechti says, however, people who move to RAK from Dubai do not do so solely to save money. “It’s not only for financial gain that people are moving to Ras Al Khaimah. It is because of its lifestyle. “People come to Ras Al Khaimah from Dubai and you hear a sigh of relief – ‘Wow, we didn’t know that this place existed’. They just love it here.”
Ms Liechti says there has been a big increase for pilots and other airline staff in Dubai moving to RAK, as their unusual working hours make traffic congestion less of a concern.
“They [pilots] would rather have their families move to a peaceful outdoors lifestyle community area than be congested in some of the towns in Dubai. They could be living in the Marina, but it could take them almost the same amount of time to get to the airport as it does from Ras Al Khaimah,” she says.
The Emirates Road to Dubai International Airport, a distance or 50 kilometres, takes an average of 45 minutes from RAK. (The trip to the new Al Maktoum International Airport at Dubai World Central will, however, take longer.)
George Abuaita, a sales adviser at Sultan Holding, a real estate agency in RAK, says the most important concern for families moving to the emirate is education. “First thing they will ask you about is schools. The main thing they ask about is the education, where is it? Is it far?” he says.
The emirate has a number of schools including Gems and Choueifat. With regard to higher education, it has the American University of Ras Al Khaimah, University of Bolton, and Royal College of Applied Science and Technology, among others.
Mr Abuaita says the rising demand for the emirate’s property began with an influx of Egyptians and Syrians moving to the UAE to escape political unrest back home.
Another driver for the demand was the opening of Hilton’s luxury Waldorf Astoria hotel in August, which attracted a number of repeat visitors.
Some of those visitors have chosen to buy property in the emirate rather than keep spending money on hotels, Mr Abuaita says.
Tourism remains an important means for drawing people into the emirate.
International hotel chains in RAK including Banyan Tree, Hilton and Rotana attracted more than a million visitors to the emirate in 2012. About US$159.4 million of tourism revenue was generated in the same year, according to the website of the Ras Al Khaimah Tourism Development Authority.
Property prices have increased by an average of 10 to 15 per cent over the past six months and Ms Liechti says the market improved in 2013 – with people who had been cautious because of the property crash of a few years ago now back on their feet and looking to buy.
“I think the market has grown by 10 to 15 per cent,” she says. “I think it will continue to grow with the same rate this year. It won’t exceed that.”
As a major developer, the trick for RAK Properties is to find a balance of supply and demand.
“We got the ratio correct at the moment because we don’t want to flood the market,” she says.
“We would like a healthy community, because a healthy community is able to grow. This is what we want. We want to grow.”
It cannot hurt that the land registry fee in RAK – 2 per cent – is half of that in Dubai.
Although the 2020 World Expo win caused prices to inflate in Dubai, Ms Liechti says the international exhibition will also draw attention to Ras Al Khaimah.
“They are going to see what potential the UAE has and then when they come, they can’t miss an emirate like RAK.
“Where else in the world can you get such waterfront properties at such prices?”
Sitting in her sea-view studio, Ms Babets said the positive atmosphere of RAK inspires her. “My entire career is connected to tourism,” she says. “You give good energy and emotions to people.”
Asked if she would ever consider undoing her move to RAK, she says: “No way. C’mon.”