Evaluate real estate in the Emirates is of great importance to those working in the real estate field, including investors, owners, and real estate agents.
Pricing the property before selling or renting it requires estimating its fair market value, which depends on several basic standards, including:
Location, technical specifications, interior and exterior design features, and classification of the residential or commercial area. Knowing that the real estate evaluation process requires a specialized person known as the real estate appraiser, who follows up on the legal and administrative procedures in the official institution authorized to do so.
Therefore, for more information on this topic, we have dedicated our following article to learn together about how to evaluate real estate in the Emirates, and methods and tools for determining the fair value with all the details and reasons that will arouse your curiosity and answer your questions related to this matter.
Real estate market value
Real estate market value: It is the specified price of the property’s value according to real estate market standards in the Emirates and within a specific period of time. This value is also used when evaluating real estate, especially by real estate owners, investors, agencies, offices, or mortgage companies.
- The market value of the property also varies between rise and fall, as the seller tries to raise the market value of the property with the aim of selling it at a higher price, while the buyer seeks to reduce this value as much as possible to buy the property at the most appropriate price for him.
The fair market value of the property is linked to many factors related to the condition of the property, whether external or internal, in order to obtain the most correct and accurate estimate of the value that is compatible with the general prices in the local market.
How to Evaluate real estate in the Emirates Dubai
Real Estate Market Analysis
Real estate market analysis is known by another name, which is comparative market analysis, which includes the entire process of evaluating real estate according to various criteria, including market trends, changes in supply and demand, and state economic policies in the context of determining the market value of private property and investment real estate.
- Investors and real estate developers rely on conducting an accurate and integrated analysis of the local market and future forecasts for real estate, including price fluctuations and risks, as well as appropriate price opportunities to ensure distinctive competition for the real estate on offer. Thus, the ability to make sound decisions regarding buying, selling, or renting operations.
Real estate standards and how to value real estate in Dubai and the Emirates
Real estate metrics for real estate evaluation include:
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Obtain an expert opinion or estimated value of the property.
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The process of estimating the property value.
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Obtain an explanatory statement that includes the steps followed to value the property and the data used to estimate the fair market value.
As for the real estate valuation mechanism in Dubai and the Emirates, it includes the following traditional steps:
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Conducting an analysis of the real estate market and comparing the value of the property to be sold or invested within the valuation standards approved in the Emirates, including the geographical location, view, area, price per square meter, external and internal decor, and the legal status of the property.
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Determine the full cost value of the property.
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Determine the value of revenues from the property, in the case of investment or regular sale.
What is meant by real estate evaluation?
Real estate evaluation is determining the price of the property in comparison to the real estate market. This is according to specific external standards, and not to its own distinctive characteristics. When evaluating real estate in the Emirates, the location, classification of the real estate area, area, construction condition, infrastructure, and other similar factors are taken into consideration, and these standards are recognized by both parties to the sale or investment contract.
Evaluate real estate in the Emirates
Evaluating real estate investment returns
The real estate investment return is the approved measure to determine the value of profit returns from real estate investment, after comparison with the original property price and the income resulting from its investment as a percentage.
As for the investment return evaluation mechanism, it is subject to the following criteria:
- Geographic location of the property: The location of the property is considered one of the most important criteria used in evaluating investment returns, as it increases the chances of selling the property in important and desirable locations by buyers, including areas close to the city center or locations with charming views.
- Type of real estate: whether residential (houses – villas) or commercial (shops, offices, hotels).
- Property area: There is no doubt that the large property area contributes to determining its higher price compared to the smaller property area.
- Structural age of the property: Modern properties are witnessing a greater demand for purchase or rent in the Emirates, speed of sale, and high prices without any obstacles. While the market for older properties that need repairs and are less expensive stagnates.
- Service and cosmetic features of the property: New properties that contain modern design features have higher prices than their counterparts with simple decorations.
Evaluate real estate in the Emirates
How to evaluate commercial real estate
Commercial real estate valuation in the UAE requires adherence to the following methods:
- Comparison method.
- Cost method.
- Income method.
Real estate valuation through comparison
- Determining the price value of commercial real estate through the comparison method includes following the following standard points:
- The location of the property and the geographical area in which it is located.
- The property’s constructional status and salient features.
- Local sale records and circumstances causing the sale.
Commercial real estate valuation through cost
- Commercial real estate evaluation through cost is based on the following criteria:
- Determine the price of the land designated for construction.
- Determine the cost of building construction.
- Determine the value of the construction price decline versus the actual use price.
- Determine the final evaluation price by determining the price of the raw land without construction, plus the price of the building built on it.
Real estate valuation through income
- Determining the value of real estate through income includes the following principles:
- Determine your estimated gross income.
- Determine the value of net income.
- Also determine the rate of available vacancies.
- Determine the total expenditure for workers and maintenance.
Evaluate real estate in the Emirates
Method of evaluating residential real estate
Residential real estate valuation in the Emirates-Dubai can be obtained through the following two methods:
- Submit an evaluation request through one of the real estate service centers.
- Submit the evaluation through the Dubai Rest application.
Submit a request for residential real estate valuation through the service centers
You can evaluate your residential property through the service center closest to your location as follows:
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Head to the nearest real estate service center to your place of residence in Dubai.
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Then submit the official documents and papers required by the client to the responsible employee.
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After that, wait for the employee to enter the application data into his electronic work system.
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Then, pay the fees required by the customer, and receive a receipt for the amount paid.
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Finally, wait for the property appraisal statement to arrive via your emails.
Residential real estate valuation via the Dubai REST application
It is possible to evaluate your residential property through the Dubai REST application by following the following steps:
- Download the Dubai Rest mobile application via the App Store or Google Play Store.
- Create a new account on the application.
- Then choose the real estate evaluation service.
- After that, enter all the required information and attach the necessary documents to complete the real estate valuation.
- Pay the fees incurred for the evaluation.
- Then send your request online and wait for a response via your emails.
Evaluate real estate in the Emirates
Evaluation of buildings and infrastructure
The buildings spread throughout the Emirates vary between residential, commercial, industrial, or administrative properties, and there are also many buildings under construction with infrastructure. Here, the method of valuing real estate differs from a completed building or infrastructure only. But in general, you should go to the Dubai Land Department (Real Estate Evaluation Center).
- You should also inquire about the mechanism for valuing real estate and property, whether ready buildings or under preparation. Also inquire about the valuation of lands prepared for construction or on which residential, commercial, or industrial properties are built, in order to obtain the details of the valuation service accurately.
Evaluate real estate in the Emirates
Location and region in real estate evaluation
Location and geographic region are included in the basic criteria when starting a real estate evaluation in the Emirates. The location of the property and the type of place it belongs to give a real impression to the seller and buyer to determine its market value. It also plays a major role in whether the price rises or falls. Especially vital locations in the city center or close to service facilities such as schools, kindergartens, clinics, hospitals, and shopping centers, in addition to real estate areas overlooking stunning natural landscapes and distinctive coastal views.
Financial metrics (revenues and expenses)
Financial metrics give a clear idea of valuing real estate and determining its fair market value in the UAE. Investors and owners rely on several financial measures when they want to evaluate their properties and present their financial feasibility in the correct manner, including investment returns and rental income, as well as construction expenses and examining the cash flow of the properties, in order to verify that the invested property is consistent with the financial objectives.
Economic and demographic assessment
Economic and demographic assessment is involved in determining the value of real estate in the UAE. The economic reality of the real estate area is reflected in the valuation of real estate there. If the financial situation of the residents is good in this area, prices will increase and the value of residential or commercial real estate will rise and vice versa.
- Likewise, the demographic assessment is no less important than the economic one in terms of studying the nature and circumstances of the population living in a specific geographical location, based on the basics of gender, age, education, and financial situation, thus linking the statistical results to the valuation of real estate in the study area.
Evaluate real estate in the Emirates
Analysis of rise and fall in prices
The real estate market in the Emirates ranks first among the rest of the Arab and international markets. Especially with the frequency of news about the rise and fall in real estate prices that the market will witness in the year 2023, according to the real estate evaluation reports in the emirates of Dubai, Abu Dhabi, Sharjah, and Ajman for the year 2022. The market has maintained a good percentage of the number of investors and buyers, both citizens and foreigners, while maintaining an acceptable rate with price fluctuations.
Advanced valuation techniques, economic models
The United Arab Emirates relies on advanced real estate evaluation techniques and modern economic models, including online real estate valuation work through the Dubai Land Department website, as well as the Derby Rest electronic application, with reliance on virtual tours to uncover the property and display it more clearly to the customer.
- On the other hand, the UAE has used the latest economic models in terms of developing real estate and determining the market value of each property. As well as providing ideal economic solutions to customers, whether when conducting sales, rent, or investment operations for foreigners.
Evaluate real estate in the Emirates
Study of legal and regulatory legitimacy
The study of real estate projects in the Emirates is based on several basic points:
- The location of property ownership within the official public transactions decree.
- Providing legal vision and advice under the supervision of the real estate agent and the lawyer specializing in real estate issues.
- Relying on experienced and trustworthy people when evaluating real estate and determining its fair market value.
- Do not conclude contracts for buying, selling, or investing without legal documents and in the presence of a lawyer and real estate appraiser.
International and local real estate standards
Real estate evaluation includes many local and international standards, as follows:
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The geographical location of the property.
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Service facilities near the property area.
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Quality of the real estate area and property style.
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The rate of revenue from the property.
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The property’s interior and exterior design specifications and features.
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Real estate construction costs and quality.
Evaluate real estate in the Emirates
Valuation of historical and cultural real estate properties
The evaluation of historical and cultural properties needs to pay attention to the following main points:
- The location of the old historical property intended for evaluation.
- The historical age of the property.
- Area of the old property.
- The style of architecture adopted in creating the historic property.
- Historical and cultural value that extends to a specific time period.
At the conclusion of our article on how to Evaluate real estate in the Emirates and the methods and tools to determine fair value, these were the most important ideas that can be relied upon in valuing real estate in the Emirates, including the valuation mechanism, the standards used, and other important details that are necessary for owners or investors to know when wanting to sell or buy or invest in real estate in the Emirates.
