How well are you aware of the real estate market in Bahrain?
The real estate market in Bahrain have flourished and the prices of properties for sale peaked in some areas. The rise reached up to 40% in a year in some areas which made many investors from Bahrain and Gulf Countries invest in the market or at least willing to learn about it.
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Bahrain have started to gain investors trust and the proof is that the majority of buyers in the new freehold projects (Amwaj, Seef, Reef Island and Juffair) are not resident of the kingdom.
In this sort of grooming markets many investors make uneducated decisions and invest with the wrong developers or in the wrong project. Many projects stopped and others were purchased at higher rates that cannot be sold or rented at a good rate.
Following the right step will prevent you from making wrong decisions in selecting the developer or broker. Also it will protect you from getting the wrong advice from the wrong people who try to trap you in the market.
Steps to choosing the Right Agent:
1. Talk to your property agent before you come to Bahrain. You can also try to hear different opinions from different agents before you land.
2. Make your mind where you are going to buy before landing to Bahrain as well. A proper research will be your guide before you land.
3. Conduct your market research by looking into different real estate portals online (websites..etc) , offline (Radio, TV, newspapers…etc).
4. The companies that have more exposure normally have better understanding of the market and better listings, so you should start with consulting these companies first.
5. When you land try to see the available properties in that area that fits your criteria. If you look into different areas with unset criteria you will get confused and will make the wrong decision due to lack of deep understanding of the area and market situation.
After that focus with one agent and give him confidence to secure the best deal. If the agent feels you may go and close with another agent, this fear will cool him down and he will not serve you at his best level of efforts.
You should take care of:
Bahrain has not got a clear legislation when it comes to brokerage practices, as a result you may face many freelancers that do real estate brokerage in their free time.
Due to that factor and lack of real experience they often give wrong advice and most of the time they try to push you to close even if they know that the property selected is not the best choice. At the same time they don’t worry about their personal/ company image as it’s a secondary source of income.
Paying a 1% commission is the common practice in Bahrain and paying it to a reputable company that can be there for you if you need anything in future is far better than paying it to a freelancer. Brokerage firms can always get you customers and find top opportunities. Those firms are keen to keep you with them by making profit so they will offer you good buyers and offer you good opportunities.
Steps to choosing the Right Property:
1. Set Your Purpose of buying.
2. Are you looking for a property for sale/rent in Bahrain?
3. Are you looking for a property in Bahrain to live in or invest?
By answering the above questions, you put yourself on the right track.
4. Set Your Budget:
Before going out for visits inform your agent about your real budget and don’t be shy. Rising your budget over your real capabilities will only waste your time and efforts. The broker doesn’t care about your wealth, he tries to find you the best deal with that budget so be very clear and to the point.
5. Ask about the property history and projected future of the property.
6. Find the best match to your budget and expectation check the property history which is:
A. Who is living/lived there?
B. What was the price rented or sold earlier?
C. How much the property was appreciated from the time of purchase?
D. What are the prices around in other building or houses?
E. What is the future of the area? Any major projects coming up?
F. Are there any empty lands for new projects to come?
7. Make an educated Decision:
Don’t rush buying a property especially if you are planning to live there. Try to stay sometime in the property –if its built already- drive from the place to your work, kids school etc. to know if this is suitable for you or not. Home buying is a decision you don’t make every day so don’t rush into it.
On the other hand, investing in properties need in depth evaluation. So don’t make such decisions based on emotions. Also, if the property you are purchasing is not for your use and It’s planned for someone else to use, you should be asking the following questions:-
1. Do people love to live in it?
2. Are there any other city or area close by that have lower price with the same quality?
3. How many units are sold/rented?
4. How many units are vacant/available?
5. How long they were not rented/sold?
6. What’s the Return on Investment?
7. What is the maintenance charge?
If you get satisfied with the answers go ahead and don’t confuse yourself by looking around again and again, always remember perfection is impossible.
1. Don’t pay without a receipt voucher, no matter how much you trust the other party.
2. Get your original contract and the copy.
3. Pay your agent to avoid problems in Bahrain. If he claims against you, your residency permit may get effected.
4. Don’t gamble paying the down payment if you are not ready to pay the balance as you may lose your money and your property.
5. Keep your communication documented as much as possible with your developer.