Introduction
Kevin: Hey everyone, welcome back! Today I’m sitting down with one of my favorite guests, Mr. Tuomas, and he’s here for a very good reason. He just bought a property here in Dubai in one of the best areas and at a great price.
In this podcast, we’re going to go over everything in detail – the process that he went through, how he found the property, essentially the entire buyer’s process, and the ideas behind why he bought the property. So stick with us to learn why Tuomas bought his property, how we can help you, and maybe why you can do the same.
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Why Wait to Buy: Building Wealth in Dubai
Kevin: So obviously Tuomas, you’ve been here for a while. So your decision to invest was a little bit more based off of knowledge, and in terms of your actual investment, it was for end use, right? So tell us a little bit more about why you bought a property now instead of maybe three years ago when you first moved here.
Tuomas: There are roughly two reasons I would say. Firstly, when I moved here, I actually just didn’t have that much money. I actually moved here with a net worth of pretty much zero. I just wanted to come here because I was on a high income relative to my wealth, and I knew that if I came here, I would be able to stack wealth much faster than anywhere else in the world.
Over these couple of years, I developed an idea of what I want, what kind of quality I want, and what I’m happy with. And essentially it was just a question of when am I at the point where I am able to – or willing to – put the money that is needed to get the kind of property that I want. And I even ended up going a little bit above the initial budget that I had.
So I’m very glad that I waited until this point because I was actually able to buy a super nice property in pretty much the exact area where I want to be. So I’m not going to be disappointed in the long run.
And the second reason was that obviously when I moved here, I didn’t really know the areas. I could have bought for investment and then it doesn’t really matter that much, but I kind of knew that I want to buy for end use. I like the idea of living in a property that I own myself because then I can furnish it and everything like that.
So I wanted to take some time to understand Dubai a bit better, to understand first of all, do I see myself staying here? Because if I want to move out, then that would not really be so good. I wanted to understand the areas and things like that, and I think at this point I had a pretty good idea of what I like, what I don’t like. I had a lot of time to think about it, so I feel like this was the right time to do that.
Kevin: Yeah, and that’s one thing that you mentioned on your channel a lot – that you wanted to actually go and explore all the different areas in Dubai before going ahead and making a purchase, which is obviously super important for end use. If you’re going to live there, you should like the area, like the building, etc. I think you even rented in that same building, right?
Tuomas: I did, yes. For a couple of weeks.
The Financial Advantage: Dubai vs. London
Kevin: Yeah. So that was really good. Now, okay, you mentioned one thing really important. You said when you moved to Dubai, you didn’t have any money at all. Basically, you had a high income, but not that much money. So my question is, if you didn’t move to Dubai, do you think that you’d be able to afford that same property today, considering that your income level would be the same, let’s say, theoretically?
Tuomas: Yeah. No chance. No chance. There are two things to consider. First of all, my absolute wealth would be much lower just because I would have had to pay all that money in taxes, right? And the other thing is, let’s say I’m living not in Dubai, but in London where I was living before, property values there on average are about 3x what they are in Dubai.
So not only would my wealth be about half of what it is now, I would have to pay 3x the price to get the same value.
“So really, it’s like a 6x difference in what I can actually afford if you compare to the scenario where I just stayed in London or something like that.”
So no, absolutely not. And that was one of the reasons why I wanted to come here, obviously, because at this stage of life I want to be able to build wealth as fast as possible so that I can buy a home for myself that I like. And there’s no other place where that is going to be faster than here.
Kevin: So good decision to move to Dubai then, I guess. Simply put, it was a good move for you to move here.
Tuomas: Yeah.
Kevin: I mean honestly, that’s something that we notice all the time, right? You move here and in your case, and to be honest the case of many people, they start making more money – maybe because of the network here, or maybe because their savings are allowing them to reinvest into their business now, generating more revenue. But there are so many different reasons to move here too. So good for you. I’m happy to see that.
And we see that all the time with our own clients too. Obviously, there are a lot of people that move to Dubai and it’s not just for tax purposes, it’s for other things too. But yeah, I’m glad to know that it helped you get to where you are and buy your property.
The Property Search Process
So let’s go over where you bought your property, because obviously we’re talking about this here but we didn’t mention it. Maybe you guys can go through the process of how you selected this property. I know you had some rental experience in some areas, so maybe you guys can go over that.
Tuomas: Yeah. So essentially, the way it worked for me is that obviously I reached out to you guys and then you put me in touch with Liall, who was your expert real estate agent.
And the way things started was we had an online call where we discussed – you asked questions like, “Okay, what are your priorities, your criteria, what are you looking for?” And then very quickly I could see in your brain you had already an idea of, “Okay, we could look at this, we could look at that, we could look at that.”
And we essentially narrowed down a couple of areas where I wanted to look. I had a couple of criteria. I wanted to be close to downtown, not necessarily in downtown, but in that side of Dubai. And then I had a certain price in mind, obviously. And I also wanted the building to feel nice. I wanted to have good build quality, things like that, and a couple of other criteria.
So essentially, we narrowed down a couple of areas and then you narrowed down a couple of buildings in each area that we then went to look at. And I actually released two videos on the channel where I showed the properties that we actually went to look at. And then at one point I found a property that I felt was the best for me and ended up pulling the trigger, and essentially you guys took care of the rest from there.
The Agent’s Expertise: Finding the Right Fit
Kevin: Yeah, that’s amazing. Liall, so what do you think helped you help him make that decision? Because obviously he can go on his own and look for properties. Obviously eventually you’ll end up working with an agent because there’s a listing agent. But how did you help him specifically find this one?
Liall: Yeah, I think what Tuomas mentioned there regarding the first call we had is always important – figuring out what the client’s needs are going to be. Whether that’s size, area, obviously their budget is a massive consideration also. That will then allow you to get a feel of where the client, or in this instance Tuomas, would potentially fit. So we managed to hone it down to a few locations near sort of downtown as you mentioned, and obviously buildings that fit your price point.
So that’s where it’s important as an agent to have knowledge of not only your area that you potentially specialize in, but the surrounding communities so that we can visit them all and understand what might fit best for you.
Kevin: Yeah. And the thing with Liall, you worked a lot with downtown, you’ve worked with Creek Harbor, you’ve worked with all the major areas. So you basically know what all the buildings look like. I have a joke with Liall – whenever I speak about a building with him in downtown, he’s like, “Oh, I know every single layout there.”
So that kind of helps you make your decision too. Not because you know the exact layout, but because you know all the towers that are available, you can then choose, “Okay, this is their budget. They want this, they want that. Okay, this is the best building for them or these are the best buildings for them.” And you don’t have to waste time looking for properties or looking at properties that are not in your description.
Even me myself, if you live in a building for long enough, you’ll find flaws with it. And once you learn those flaws, then you’ll be able to say, “Okay, maybe this is not the best for someone who wants this or that.” And working with someone like you, Liall, you know all the flaws in every building. So definitely helps.
Liall: Yeah. No, definitely. I think as well, you can sometimes use your knowledge and not surprise your client as such, but I suppose when we first had the conversation, you were probably more set on going to downtown than anywhere else. And that’s where you can use your knowledge and say, “Look, that’s potentially an option for us. However, let’s consider these areas as well as we may get a little bit more property for your money there.”
Which is what we ended up doing actually. But yeah, that’s definitely a big factor – just understanding the surrounding communities, not only just specializing and knowing one area, because often your client needs to see a few options before they can make that decision.
Learning from Expert Insights
Tuomas: Yes, there were a lot of things in the process where I learned more because obviously you had the knowledge and everything, and there were options that we considered that I would not even have thought of. Like for example, I knew that I wanted a new, high-quality building, and then you suggested, “That’s obviously a great option, but we could also look at older buildings that are perhaps refurbished, where the units themselves are renovated.”
And we didn’t end up going for a unit like that, but I could have easily ended up going for a unit like that. We ended up seeing a couple of units in older buildings but they were renovated, so actually they seemed very, very nice. And that was just something that I would not even have thought of if I had not been working with you, essentially.
“There were a lot of specific things like this that throughout the process would have taken me a long time to figure out on my own that I was able to figure out straight away with you.”
The Top Three Contenders
Kevin: So what were your top three options for buying – which were the top three towers, I should say, that you were considering to buy at the end?
Tuomas: So the three areas we looked at were Creek Harbor, Sobha Hartland, and downtown. And from those, we narrowed down quickly a couple of towers that perhaps weren’t the best.
In the end, what would be the top three? The top three would probably be The Grand in Creek Harbor where I actually ended up buying. And then it was Creek Edge, which is right next to The Grand in Creek Harbor. And then there was one tower in Sobha Hartland by Ellington – I actually forgot the name of it. There was a super, super nice unit, but I ended up deciding that Creek was more the area where I wanted to go. So I didn’t end up going for that one.
So those were probably the top three. And that was kind of surprising to me because like you said in the beginning, I was like, “Yeah, I’m probably going to go to downtown.” But then when we looked at the units there, sure they were good, but clearly I was able to get more for my money in those other areas.
And when I really thought about my specific lifestyle and stuff – I mostly stay inside, I don’t need to be in downtown, and I’m not going out to Dubai Mall every day – it’s enough to be close and be able to get a bit more for my money in some of those other areas. So that’s why we actually moved out of downtown quite quickly.
Kevin: Yeah, that’s basically what happened, right? You were looking at older downtown buildings because everything downtown is a little bit older now. We have to be honest, most stuff there is old.
Tuomas: And the ones that are new, often the sizes are quite small, and that was quite important for me as we learned through the process. I wanted a big size, but then if you wanted a new building and a big size in downtown – obviously if you’re willing to pay enough, there’s going to be options – but for my budget range, the options were much better in those other areas.
The Final Purchase: Details and Fees
Kevin: So let’s tell the viewers what you bought then. You bought in Creek. Tell us the tower, the type of unit.
Tuomas: So I bought in the building called The Grand. I thought I could hide it, but probably I’m going to show it on the channel. People are going to be able to find it eventually. Someone’s going to find it.
Kevin: The views are too recognizable, especially from that building. It’s so recognizable.
Tuomas: Exactly. Exactly. So that’s the building. It’s a one-bedroom unit for 2.3 million dirhams with a down payment of 40%. I’ll probably go over all the finances in more detail in a separate video.
But essentially, that was the price, that was the down payment, I got a mortgage. There are a lot of fees. That’s something that I definitely learned. In total, I ended up paying roughly about 7% of the property value just in fees when it comes to the government fees, the mortgage fees, the agent fees, everything like that.
So that’s what you have to be able to expect. But the upside obviously is that there’s no recurring property taxes or anything like that in the UAE. There are a lot of fees in the beginning, but if you hold it for long enough, then when you average it out, it doesn’t come out to that much. But there are a lot of upfront fees that you might want to consider, for sure.
Liall: I was just going to say as well, it was important at the beginning of your search that we discussed where you’re at with your pre-approval and what you had essentially from your mortgage advisor. So that we could understand, can we go over the budget or how much could we go over?
Because we essentially did a little bit, using a bit more cash than we first anticipated. And obviously it’s important that we knew what the fees were going to be, so it allowed you to have that 7% extra in cash. Because sometimes what will happen is that you’ll have agents that won’t disclose this as such, and then next thing you know, you’ve got an extra 7% to account for.
Advice for First-Time Buyers
Kevin: Yeah. There are some hidden fees. So obviously the fees are something that people should know about, but past fees, what are some things that maybe a first-time buyer should be aware about before investing in Dubai?
Tuomas: Well, obviously like I mentioned, you need to know the areas. People can often be surprised as to – they might like one area in the beginning. Like I lived in Marina for a long time, for example, but then eventually after I stayed there for a while, I realized that perhaps I don’t want to live there because it’s quite touristy. The traffic can be really bad. So there are always things you learn when you stay in a place for a while.
“If you’re buying for end use, first of all, what I would do is when you come to Dubai, stay in Airbnbs, stay in short-term rentals, stay in a lot of different areas because that will quickly give you an idea of the different vibes.”
There are so many different areas with so many different vibes for so many different kinds of people. If you’re buying for end use, I would definitely, definitely do that before you jump in. That’s probably the main thing.
Also, in the process, the process itself is extremely, extremely quick. But obviously you need to be aware of all of these fees and things like that. And if you are buying for investment – and even if not, to be honest, because every property is an investment at the end of the day – you want to make sure you do all the calculations on the different areas and understand exactly what your return is going to be. You need to understand all the hidden fees, not just the upfront fees.
I bought mainly because financially it makes sense to buy here. So you want to make sure that you are aware of all these calculations, all the expenses, and you want to consider what you’re foregoing in terms of returns where you could invest otherwise and all these kind of things. So there’s a lot to think about, and obviously if you just speak to an expert, then they can help you learn a lot of these things that you might not learn on your own.
Build Quality and the Small Details That Matter
Tuomas: And one thing I wanted to add that I just thought about is build quality. That can be very inconsistent in Dubai, and a lot of people can be surprised by that. So that was a big thing. I was looking at all these different units.
Obviously, you helped me pretty much only look at buildings where the build quality was good. But if you don’t think about this, if you don’t consider it, you might end up in a unit that looks nice – I lived in a couple of units like this before in short-term rentals or something like that – but then after a while, you find out that there are all these kind of issues and small issues, like the elevator is never working or something like that.
So that is something to keep in mind. Now, if you work with the best developers, you make sure to go look at the units and pay attention, you can find amazing build quality here. But it can be inconsistent. So that’s another thing to consider when you’re looking for a property.
Kevin: Definitely. Even something super small – you just made me think about this – like even parking spots, parking allocation. I had a negative experience with my current building where I love the unit, I love the building, but the parking is on B2 and I have to go down two levels before I go – four levels of these tiny – I scratched the rental car like three times trying to go down. I was like… Again, these are the small things that you realize after a while.
Tuomas: Exactly. And where you bought, the parking is amazing.
Kevin: Yes. Exactly. But for example, I experienced this. I didn’t scratch the car, but I scratched the rims a few times until I perfected the angles. But you shouldn’t have to be a professional stunt driver to not scratch the rims, you know? And this alone is making me reconsider every building that I’m going to invest or rent in.
The agents that I go on viewings with, if it’s not Liall for a ready property, they’re all confused. They’re like, “Why does this guy want to go see the parking?” I run to the parking, I look at the parking spot, I run down everywhere, I look at how thick the walls are, how wide the walls are. And it is important.
Even right now, I love playing tennis. I want to move into a tower that has a tennis court.
Tuomas: My tower actually has a tennis court.
Kevin: Yes, it does. Amazing tennis court. Yeah, that’s why it’s actually so popular. Not many towers have tennis courts, and that’s actually a really unique selling point. But in downtown, there are only around I think three with tennis courts. And before I go buy and rent in a tower, my girlfriend was like, “Yeah, this is perfect, but let’s grab our rackets, our tennis balls, and on the next showing, let’s go and actually play to make sure the court is actually right.”
So you know, you don’t want to rent or pay 200k for rent or something, and then the tennis court doesn’t suit you.
Tuomas: Yeah.
Kevin: So these are things that, you know, when you work with an agent they’ll know. For example, if you mention a building to Liall, he’ll know, “Okay, well this tower has really bad parking on this floor. Maybe on B1 it’s good, but B2 you’re going to have to go through a specific turn that you won’t like.” These are things that you have to keep in mind when you’re working with someone.
Liall: Yeah, definitely. I think we covered a majority of the points there you’d be looking for as a first-time buyer. And as you said, Tuomas, as well, with the developers and the build quality, it’s massive. I think when we were looking for your unit, we were set on Creek Harbor as the location that you wanted, which is master-developed by Emaar.
So all the developments there are by Emaar. But we saw an Ellington building in Sobha Hartland, and Ellington is really top tier in terms of build quality, finishing, and so on, and that almost made us go for that location.
Tuomas: That was very tempting.
Liall: Yeah, just on the basis of that. And then also what you said, Kevin, about the data is a massive one. Because especially if you’re buying with a mortgage in Dubai, the bank is essentially lending you the money on your property, so the property needs to value by the valuers. So it’s important before you buy the property, especially if you’re buying with a mortgage, that it’s going to hit the valuation. Because if not, the bank won’t lend you the full amount of money.
Kevin: And then it’s too late.
Liall: Yeah. So in your instance, I knew that there were higher floors that had went for more, and we’d seen very close transactions on slightly lower floors. So we knew that it was good value in the market because the market is so hot at the moment as well. So yeah, definitely good points to consider, especially in that tower too.
Future Investment Plans
Kevin: Now, okay, last thing I have for you, Mr. Tuomas. You bought a property. What are your next goals or steps? Do you have any future plans with Dubai real estate? Maybe off-plan, ready? Are you considering anything?
Tuomas: Not in the near future, but for the near future, I just want to build out my stock portfolio and things like that because now I put a large chunk into…
Kevin: 40% down.
Tuomas: Yes, exactly. So before I put more into property in Dubai, I’m going to build out my portfolio in other places a bit more. But at some point, definitely I would think about either a rental property or holiday homes – I know you have one of those – or an off-plan. I’m not sure yet, but let’s say in two years or something like that, I’ll be looking at it again. But yeah, again, I’ll have a long time to think about that.
Kevin: Yeah. Who knows? Maybe with the tax-free savings, you’ll be buying another one before you know it. Honestly, you never know in Dubai. Next week you can meet someone who’s going to help you make even more money, and who knows, maybe…
Tuomas: Yeah. Yeah, things can happen very, very quick.
Off-Plan vs. Ready Property: When to Choose Each
Kevin: Yeah. So what about off-plan? You guys obviously also do off-plan. You mentioned 70% is off-plan. Is that correct?
Liall: Yeah, currently. Yeah.
Tuomas: When a client comes to you and is looking to buy a property, how do you approach the conversation of when do you recommend off-plan, when do you recommend ready? How do you think about when is one better or the other?
Liall: Yeah, that’s a very good question, and there’s probably quite a few layers to it. What I would say in general is that first of all, we need to figure out are they going to live in the property or is it investment. Secondly, do they need the property right now, or are they happy to rent? What’s their situation there? So that will definitely help us look into that aspect.
If they are an investor and they’ve got a lot of cash available, that’s probably someone that we could quite easily put into off-plan. As we’ve mentioned, off-plan is seeing a lot of the transactions because it has such generous payment plans. So like you said, you put down 40% for the mortgage – 40% down in your instance, and then a 60% mortgage.
The off-plan, you’re buying the property cash, but you are on sometimes a 50/50 payment plan, sometimes even more generous. It really does depend. So that’s really how we figure it out at the beginning – working out if they’re an investor or an end user, and then working out what situation they’re in with cash and how much they have available.
The Risks and Rewards of Off-Plan Investment
Kevin: Yeah. Also it comes down to the risk profile. Obviously off-plan is not built yet. There are possibilities of delays, handover issues, whatever, right? So someone who’s a little bit more risk-averse, who doesn’t like risk, would probably consider more of a ready property that just gives simple returns and it’s not that high-yielding. Well, someone who does want to get a little bit more will go for off-plan. That’s what we’ve noticed.
Now, one thing to keep in mind is the risk can be mitigated if you pick the right developers, the right properties, the right areas. So for example, we have some developers that we know are going to deliver really good properties. They’re selling it at a valuable price, not cheap but a valuable price, where you can actually see a lot of appreciation. And they will hand it over on time because they have a really good track record.
But now, more and more on the market, the problem with off-plan is we’ve seen a lot of the time that a lot of developers have really shifted. It’s no longer value-driven. Now off-plan for a lot of the properties that are being sold are being sold to people who just can’t afford to get a ready property. So they’re getting a worse deal on an off-plan property.
For example, let’s say something’s not built yet. It’s selling at 2,000 dirhams per square foot. In the exact same area, it could be 1,800. In that case, does it really make sense to buy something off-plan for an investment? I mean, unless there’s a big difference between the ready property and the off-plan property, okay, maybe. But in the case where it’s the same thing, no, absolutely not. Why would you pay a premium for something that’s cheaper on the market today?
So that’s what we’re seeing a lot of the time. We have some clients who not only pay a premium, but then they get a double whammy—and it’s not because they buy with us, they bought with other people, but they come to us after for other investments. They sometimes buy from developers who have no reputation, have a very beautiful pitch deck for their property, and unfortunately, they’re also selling at a really high price per square foot.
Red Flags: When Projects Look Good But Aren’t
I had a client the other day – I won’t mention the developer, I don’t want to get sued by a developer – but the developer, really big brand name, not tied to real estate… maybe you guys can figure this out on your own. They have an amazing project launching and I checked it out. The price per square foot actually looked fair. However, the developer itself has no track record for this project. And then months and months and months after this project launched, even after being branded by this really big international brand, has no transactions at all.
And we can actually see the data that’s registered with the Dubai Land Department to see if people are actually buying it off-plan or ready, whatever. We can see all of this. And it was so strange to me because something this big, this branded, had no sales. I even messaged to double-check the authorities to check that it was actually correct.
And yeah, they told me yes, there’s nothing registered. So you need to be careful. Something could look great, the price could be good, but no track record could be a huge issue. And you need to work with experts who can actually look into the details just like us. So that’s the thing.
Liall: I think as well, good point you mentioned there regarding the fact that their pitch deck and their brochure looked very good, and that’s easily done, to be honest with you. That is extremely easily done.
“Every brochure that you’ll look at for off-plan will look really good. So that’s something to take into account when you are looking, because there’s a new project launching on average about every 16 hours here in Dubai.”
And as soon as you start looking for a property, I can imagine the search engine through your phone and all these different things will start to showcase different launches and different payment plans. And that’s where you need essentially a broker to make sure that you’re getting into the right project – someone that knows the market, knows the areas that you’re investing in, and the developers as well. So that’s the things to be cautious of for sure.
Real-World Examples and Final Thoughts
Kevin: One thing to mention, so that example that I was giving you, it’s a real example. My client, he made an EOI on that developer without telling me. He made an EOI on that developer. It was only 20,000. Thank God. After I told him all this information, he just gave up his 20,000 because he was like, “I don’t want to invest more into this developer if they’re not going to build the project.” And that’s just one case. There are so many cases where this happens time and time again.
Now you mentioned, again, why would someone choose off-plan or ready? Honestly, again, it comes to the person’s taste, right? Some people genuinely know they’ll make less money maybe owning the property or buying in this area, but they’re just happy to do it because it makes them happy and satisfied. That’s totally fair. Not everything has to be to make the most amount of money possible. It could just be what makes you happy.
In some cases, some people know that buying an apartment with a Burj Khalifa view will get you maybe less of a yield because you’re paying more. However, the appreciation might be a little bit better, but they don’t care. They just want something with a Burj view. I have some clients who literally told me, “Kevin, I don’t care where I’m buying. I just want to have the top floor, and I want it to be over 40 floors,” and that’s just their only requirement. I have clients like that.
So it comes down to the client. Of course, we’re going to inform them and tell them, “Okay, I like this. I like that.” Give them our ideas and thoughts, but it comes down to them. And of course, if you’re buying more than one, just like you think, “Okay, maybe I won’t buy another ready property now. I want to diversify.” Same thing for them. I own multiple properties myself, both off-plan and ready. I wouldn’t go all off-plan and I wouldn’t go all ready. It’s good to diversify and good.
