Time to buy real estate in Dubai?

The opening of the Montgomerie Golf Academy in Dubai's new upmarket Emirates Hills is another small landmark in the evolution of the Dubai real estate sector into a world-class investment opportunity.

Not that the annual green fees are a bargain at $4,900 for a single membership, there are cheaper options even in Dubai. It is the exclusiveness of the location that members will be paying for, a course adjacent to Dubai's answer to Beverley Hills. Here the rich and famous can buy homes from $1.5m upwards, regardless of nationality.

On the horizon golfers at the Montgomerie can also see the three towers of the Dubai Marina rising against the backdrop of the Gulf of Arabia. These high standard condominiums are more modestly priced, and a three-bed apartment will set you back around $300,000 for a 99-year lease.

Both Emaar Hills and Dubai Marina are owned by Emaar Properties, a huge property concern with assets worth more than $5 billion, and itself 30 per cent owned by the Dubai government. Construction is to a very high standard indeed, and leaseholders will also receive a guarantee of sponsorship for life. So if you buy a home you will be able to stay living in it regardless of employment status.

Now that Emaar's residential developments are starting to take shape investors from the Middle East and the rest of the world are starting to take note. Dubai is a rapidly growing city and such locations have often been good places for property investment in the past.

Early indications are good. The first two towers on the Dubai Marina sold out quickly and there are not many apartments left. The Emirates Hills combines self-build options for larger properties with ready constructed schemes such as the Andalucia development of large-size villas. Here many villas are now under construction and agents say that the past month has been a good one for sales.

So are Emaar Properties a realistic investment option? There is no doubt that for rent-paying expatriates intending to stay more than five years in Dubai then it pays to buy a home if you can. Simple economics show that it is better to end up owning a home than having nothing to show for years of renting.

Financing options from Emaar's Amlak mortgage company are also attractive with rates finely tuned to international markets. Whether Emaar should be considered for a straightforward investment property is more difficult. Its prices look neither cheap nor expensive by world standards, and those with the option to invest in more mature property markets they might decide to do so.

After all the risk in Dubai is that the second-hand market remains an unknown for expatriates, who have not been able to own property before. But of course, property changes hands all the time between Dubai nationals, so a market does obviously exist and an active one too judging by the recent levels of real estate transactions.

On the other hand, if there is a downside risk, there is also considerable upside potential. Anyone who bought an apartment in Hong Kong or Singapore in the early days will be a happy person today, despite the deep recessions that have engulfed both cities recently.

So if you believe in the future of Dubai or plan to stay in the emirate then buy a property if your circumstances allow you to. For how many people have you ever met who lost money on bricks and mortar in the long run? And how many have regretted not having done so?