A Real Case Study

A year ago, a client—let’s call him Client S—approached me for assistance in selling his property, a hotel studio he had purchased from a well-known developer.

He was drawn to what seemed like an attractive opportunity: a branded hotel room in a prime location, marketed as a ready-running business with a promised 10% return on investment for three years, along with a post-handover payment plan over the same period. The offer appeared straightforward—pay 20% of the price plus 4% for DLD ownership registration, then start earning income.

However, based on my experience and market insights, I suspected that this deal might be too good to be true. A thorough market analysis confirmed my concerns. Resale listings for the property were priced below the original purchase value, raising a red flag. Further investigation into recent sales transactions revealed that in the past six months, all sales had been made by the developer itself—there were no individual resales.

Despite these concerns, I proceeded with listing the property in compliance with DLD regulations. During this process, I uncovered a major discrepancy: the unit registered in Oqood was not the one my client believed he had purchased. The developer had misled him by showcasing a more desirable unit with a similar name but a different word order.

Additionally, the promised 10% return on investment was misleading—it only applied to the amount already paid. Since the property was on a post-handover payment plan, my client’s payments were structured in small installments, often insufficient to cover the next due amount. Any delay incurred penalties, significantly eroding the projected returns.

Exiting the investment proved to be a challenge. The property had gained a reputation for issues, making it unattractive to potential investors. After multiple visits to the developer’s customer care office and discussions with various specialists, my client ultimately decided to withdraw the property from the market.

However, the story didn’t end there. Over the following year, I maintained close communication with Client S, providing guidance and introducing him to high-quality properties from reputable developers in Dubai. Eventually, he made a new investment with a trusted developer, turning his negative experience into a positive one.

This experience underscores the importance of working with a professional broker rather than buying directly from developers. A knowledgeable broker not only protects an investor from pitfalls but also ensures a seamless journey through the complexities of the real estate market.

Every investor deserves a professional broker who can navigate the vast real estate landscape with expertise and integrity.