Burj Khalifa Service Charges Increased

Buy sell Property & Real Estate Investment Guide

Buying Property Tips#1: Choose the Right Location
Before you choose a location, it is of utmost importance that you consider the development prospect of the area. Other factors to consider here is crime record of the area, availability and nearness of public facilities and utilities.
Buying Property Tips#2: Study the Local Market Dynamics
It is important to get well familiar with the local realty market. Learn the variation in property prices by street. Don’t shy away from asking a few realty investment agents questions to get better insight on the matter.

Owners of residential properties will have to pay 27 percent more than they did in 2012. At the same time service charges for corporate suites have been increased by 37 percent.

In a league of its own

Last week a report ofglobal consultancy firm Jones Lang LaSalle (JLL) revealed that the Dubai property market offers on average significantly lower service charges for office properties compared with other top property markets such as New York, London, Tokyo and Hong Kong. However, things quickly change when it comes to BuljKhalifa, the world's tallest building, where both residential and corporate service charges stand much higher than the respective averages in the sheikhdom. And with the BurjKhalifa charges having been recently increased, it seems that the gap will continue to widen.

Buying Property Tips#3: Choose the Right Property
Getting the right property right away is quite unlikely. First, you need to be clear on why you want to buy an investment property. After that, you will be able to make right decision based on factors like remoteness or accessibility of the property.
Buying Property Tips#4: Do the Math Properly
Get a precise idea on the value of assets you have available. If you are investing in rental property, make sure you can easily cover the mortgage payment through rents. Additionally, get a clear idea on the appraisal value of the property beforehand.
Buying Property Tips#5: Consider Additional Expenses
When purchasing an investment property, it is not only the selling price that investors need to consider. There are various additional expenses such as property tax, home owner’s insurance, repair & maintenance that must be considered.

Residential service charges in BurjKhalifa for 2013 have been increased to Dh70.02 per square footfrom Dh55.01 in 2012, while the Armani Residences, a luxury collection of homes designed by Giorgio Armani and located in BurjKhalifa, have stayed relatively stable at Dh85.35 per square foot compared to Dh83.12 per square foot last year. The biggest increase, however, is seen in the service charges for corporate suites. Owners of such properties in the tower havieto pay Dh104 per square foot in 2013, 37 percent more than last year.

In an invoice sent to an apartment owner in BurjKhalifa, Emaar Properties, the developer operating the tower, explained that “after a thorough review of the current and projected costs, we would like to inform you that the 2013 community service fee for BurjKhalifa has been issued in accordance to rates approved by Rera.”

The Real Estate Regulatory Agency (RERA) was established as a result of a law issued by His Highness Sheikh Mohammed bin Rashid Al Maktoum, UAE Vice President, Prime Minister and Ruler of Dubai, in 2007.The service charge in the tower consists of three components – community service fee, hot and cold water charge and chiller charge.

Demand driven by unique status

One of the reasons for thelower office service charge rates in Dubai noted in JLL's report is the competitiveness of the Dubai property sector which leaves tenants with plenty of alternatives in terms of real estate.

Buying Property Tips#6: Inspect the Property
To ensure that you are getting everything you are paying for, a thorough inspection of the property is essential. Besides ensuring that you are not overpaying, a rigorous property inspection also gives you a good estimation on what the additional expenses might be.
Buying Property Tips#7: Pick the Right Financing Option
While interests on investment property loans are tax free, some borrowing costs aren’t immediately tax deductible. Knowing that, and structuring your financing in accordance is crucial. Don’t hesitate to ask for help from a financial advisor.
Buying Property Tips#8: Invest through Equity
One of the best ways to purchase an investment property is to leverage the equity of another property (including your primary home). This is a preferable way among regular investors, especially due to added tax deduction advantages.
Updated: April 4, 2017 — 4:48 am
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