Dubai is a great place to buy a property whether you’re an investor or just want to move here. As you may have heard, purchasing a property in Dubai can come with a residency visa and that is true, which makes Dubai an attractive destination for investors. Properties in Dubai can bring in a high rental yield, have a high market capitalisation, and a there is a transparent business process. It may seem like a complicated process when it comes to buying a property but the Dubai Land Department and other government bodies have made the process simple and easy.
Now, there are three property types that you can buy as a foreigner in Dubai.
1] Freehold Property – You have full ownership of the property in perpetuity, the property can be used for any purpose.
2] Commonhold Property – With Commonhold properties you own the property and have the right to buy, sell and rent. But with this type of purchase you are responsible for property maintenance fee and other common fees. So if you stay in an apartment block you would own the apartment outright like in freehold but pay the building service charge, maintenance charge, etc..
3] Usufruct Properties – This is a lease for long-term investment. The occupant of the property does not have the right to amend or change a usufruct property in any way. Leases for these types of property purchases have a life that could go up to 100 years.
The different kinds of property prices: –
List Price: Asking price and is negotiable.
Sale Price: What price has been agreed for the sale.
Appraised Value: The price the real estate agent has given.
Once you have found the home you want, then it comes to viewing and buying your home.
The quick simple steps: –
If you want to buy a property where the seller has a mortgage, you need to be in a position to discharge the seller’s mortgage before collecting their title deed from the Land Department.
Use a RERA-registered broker.
Present an offer to the seller, and once your offer has been accepted, the seller’s agent will make the memorandum of understanding (contract) which states both buyers and sellers costs and responsibilities.
You pays a 10 per cent deposit in the name of the seller to secure the property.
Depending on whether you are paying cash using a mortgage, the next step is for your bank to carry out a valuation process to inspect the property and make sure that it is secure.
Once the you receive the final approval, the seller will apply for the No Objection Certificate (NOC) from the developer.
An appointment needs to be booked at the Land Department in order to complete the transfer.
When all processes have been registered, you need to pay 2% and AED315 to the Dubai Land Department (DLD), along with the purchase price to the seller and the commission to the agent.
You will then be given the title deed in your name, along with the keys and the access cards to your nice new house. YAY!
If you need to apply for a mortgage. Prepare the following:
Salary letter from your employer
Any salary slips you might have received
Bank statements of the last six months
Passport copy with both a photo and visa page
Copy of your Emirates ID
Copy of current credit card statements
Proof of address
Note that the mortgage pre-approval stage might take up to seven days for company employed salaried borrowers, and even longer for self-employed individuals.
Other costs you need to consider when it comes to buying a home in Dubai, UAE: –
Deposits as per Agreement of sale between Buyer & Seller
Transfer fees with the Land Department
Connection fees for electricity and water authorities (DEWA – Dubai Electricity and Water Authority)
Community service fees
Mortgage application fees if required
Misc admin fees to the Land Department
What costs you need to consider when it comes to selling your home in Dubai, UAE: –
Clearance of mortgage (cancellation fees)
Clearance of service charges/maintenance fees
Settlement of DEWA/District cooling
Developer’s NOC (non objection certificate) if required
Transfer fees paid to the Land Department