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Purchasing property in Dubai

Purchasing property in Dubai

Old Feb 13th 2018, 7:52 am
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Default Re: Purchasing property in Dubai

I also have a 1 step plan

1. Dont

Originally Posted by JohnMcCallister View Post
Yes, you can buy property in Dubai and I have included steps below:

Part 1: Finding Properties to Buy:

Determine what type of property you are interested in: Foreign buyers often choose to purchase either apartments, townhouses, or villas, which are generally located in secure complexes with communal leisure facilities such as tennis courts, swimming pools and gyms.

Since 2002, when, by royal decree, foreign nationals first became eligible to own property, Dubai has enjoyed a construction boom.

Ensure you are looking at an area in which foreigners are allowed to buy property.

Some of the most popular, luxurious and expensive developments include Emaar Towers, Jumeirah Gardens, International City and Al Hamra Village.

Start Searching Online: As with any property search, a good place to start is online. There are numerous agencies and estate agents that list properties in Dubai online. You can buy properties from estate agents or from property developers. Estate agents generally sell resale properties, properties that have been built and have previous owners. Developers sell off-plan properties, which may be still under construction.

Contact specialist agents: If you want help with your search, and want to talk to someone with specialist knowledge about the property market in Dubai, it’s best to employ an estate agent to work with. Estate agents can help you find properties and explain your options to you. Big real estate companies will be used to dealing with foreign buyers and will speak English.

Laws and regulations can change quickly in Dubai, so hiring an agent will help you avoid any potential pitfalls.

Usually, if you hire an Estate Agent, you can expect to pay a fee of between 2% and 5% of the value of the property.

You should always check the credentials of anybody you hire. The regulatory body for Real Estate in Dubai is the Real Estate Regulatory Agency (RERA).

Attend property fairs: The property market in Dubai is still relatively young, although growing fast. As a result, a significant amount of property bought by foreigners is bought from developers who may not have built the development yet. Property fairs are a popular way for developers to present their work and meet potential buyers. These property fairs are held all over the world, so look for one visiting a city near you.

You should always check that the developer you are considering is registered and licensed with the RERA.

Visit Dubai: Before you think about making a move for a property be sure that you have spent a little time in Dubai. If you are buying a resale property ensure that you view as many properties as you can, and ask the same questions you would ask if you were buying property anywhere else in the world.

If you are buying off-plan or construction is not complete, make sure you go to see similar properties by the same developer that are finished.

When you are in Dubai, you will also have access to paper listings in specialist local newspapers and magazines, and be able to attend the property fairs that continue all year.

Part 2: Meeting Eligibility and Financial Requirements

Have the required ID and visa documents: Since a change to the law in 2002, it has become much more straightforward for foreigners to buy and rent property in Dubai. You will, however, still need to present a valid passport to prove your identity. You are not required to hold any type of residency permit in order to buy property, but assuming you want to stay there you will have to take care of this.

The UAE government has a six-month visa for property buyers, called the “Property Holders Visa.”

This allows foreign investors to stay in Dubai for six months while they investigate investments.

To qualify for this, the property you buy must have a value greater than 1 million dirham, which equates to around $272,000.

You must be buying as an individual, not as a company.

Determine the full costs: You need to be certain that you can afford the property and meet all of the costs attached to the purchase. When you are determining the overall cost of the property you should include the purchase price, the deposit, transfer fees, estate agent fees and the potential for currency exchange rates to fluctuate.

It is not legally necessary, but it is advisable to employ a lawyer to help you negotiate all the paperwork.

Include the costs of a lawyer in your calculations. A new-build property will likely require a land registration fee of around 2%.

Get a mortgage in Dubai: Mortgages can be difficult to obtain in Dubai. Non-status/self-certification mortgages are not available and the amount of red tape and paperwork involved can be off-putting to those accustomed to a less rigorous system. In some cases, buyers may be required to put down between 20% and 50% of the value of the mortgage in cash.

Mortgages in Dubai are paid in monthly installments, with 15 years mortgages the most common. Residents of India cannot mortgage their property in Dubai and raise loans. Indian residents are also not permitted to give the guarantee to the loan from a nonresident.

The maximum length of a Dubai mortgage plan is 25 years.

Mortgage repayments, combined with any other monthly expenses, must not exceed 35% of net monthly income.

As exchange control is a complex subject, it is advisable to obtain appropriate professional advice before deciding to take out a mortgage in a foreign currency.

Mortgage rules change often in Dubai, so try to keep up-to-date by consulting local news and the Central Bank of the UAE.

Part 3: Buying “Off-Plan” Property:

Submit a reservation form: If you are buying property off-plan, the first step once you have decided on the property you want and secured all the financing, is to submit a completed reservation form. This form will summarise the basic terms and conditions of the sales agreement, including information on the payment plan, and personal information from all parties.

You will be required to submit your passport along with the reservation form.

Be aware that some developers are still selling leasehold rather than freehold titles. If this is the case, the title is valid for the period stipulated in the lease agreement.

Ensure you fully understand the details of the contract and have it checked by your lawyer.

If the property is not yet complete, make sure you know what responsibilities the developer as if it is delayed for any reason.

Pay the reservation deposit: Once the reservation document has been agreed you will have to pay the reservation deposit. The amount will be stipulated in your reservation form, but it will typically be between 5% and 15% of the purchase price. Developers will often not draw up the official sales and purchase agreement until this deposit has been paid, and will sometimes charge up to 20% or more.

When buying off-plan, you should ensure that the deposits and payments you make are paid into a RERA-approved securities account.

These payments are then transferred to the developer as the construction work is completed.

Complete a formal sales and purchase agreement: The formal and legally binding contract is the sales and purchases agreement. Make sure this documents the date by which the property should be completed, and what penalties the developer will incur if it is delayed. Have a lawyer look over the contract with you, and check all the details, terms and conditions.

If the property is supposed to be furnished, ensure that a date for when that will be done is included in the agreement.

Transfer the deeds: To complete the purchase you must transfer the deeds. This is the point at which you will be required to pay 100% of the purchase price. The deeds will not be transferred, and you will not own the property until you have paid, so you must have to finance in place.

If the property has been completed, the transfer will happen at the Land Department Offices.

If it is yet to be finished, you will transfer the deeds to the developer’s office.

You will then generally be invited to inspect the property and highlight any final issues the developer needs to take care of.

Part 4: Buying “Resale” Property:

Make a Memorandum of Understanding: To purchase resale property in Dubai you must agree to terms with the seller, and record this in a Memorandum of Understanding (MOU). This is a basic document that outlines the terms and conditions, including the date of the final purchase. It is not legally binding but is a necessary first step to buying resale property.

Pay the initial deposit: Once the MOU is signed, the purchaser will have to pay the deposit, typically around 10% of the purchase price.

This deposit is normally non-refundable unless there is a particular reason why the seller is unable to bring the transaction forward.

At this point, you will also have to pay the real estate commission, normally between 2% and 5%.

Obtain the deeds: Once you have an agreement and financing in place, you can move on and complete the purchase. As an expat you will be required to pay 100% of the purchase price before the deeds are transferred, just as if you were buying an off-plan development. To do this, you may need to attend an appointment at the Land Department and present all the paperwork.

The buyer, the real estate agent, and a somebody from the bank that is financing the purchase may all be required to attend the meeting at the Land Department.
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Old Feb 14th 2018, 7:10 am
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Default Re: Purchasing property in Dubai

A year after opening the thread, I decided not to purchase in the ME.

I over analysed the possible scenarios and the political risk, financial instability, etc is too much to gamble. Even though I hate paying rent and not owning the place.

I'm leaning towards purchasing my second property in the UK and looking at Homes of Multiple Occupancy (HMO) to make a sufficient return. Target remains purchasing before the end of the year.
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Old Feb 14th 2018, 7:18 am
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Default Re: Purchasing property in Dubai

Originally Posted by Taz786 View Post
A year after opening the thread, I decided not to purchase in the ME.
Do as the locals do - drive a patrol here and a house in London
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Old Apr 27th 2018, 4:43 am
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Default Re: Purchasing property in Dubai

I've been wondering if it would be a good idea for me to buy a studio in the UAE , Ive been offfered a job with an all in salary and thought that rather than lose money in paying rent to someone I could own a place for a couple of years then sell it when I leave
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Old Apr 27th 2018, 4:52 am
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Default Re: Purchasing property in Dubai

Come out here and rent for a year first before you decide.

At the end of that year you will be glad you waited.

Buying out here is very different to home. Mortgages and fees are expensive. Houses depreciate quickly (most buyers want new). And the biggest risk is that at some point you can get stung for a crime and put on a plane out.

One piece of advice I was given before moving here. Always be ready to leave within 30 days.
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Old Apr 27th 2018, 7:14 am
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Default Re: Purchasing property in Dubai

Excellent advice from dominoman.

The UAE property market is very, very different from that in the UK and Europe and isn't a traditional liquid buy-sell marketplace. There is a tiny pool of buyers and sellers particularly for any property expensive enough for Westerners to want to buy. Locals are not part of the UAE property market as they get their houses for free and are subject to a different system.

Risk factor is enormous; do as Taz did and buy a second house in the UK or a vacation property somewhere else.
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Old Apr 28th 2018, 10:25 am
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Default Re: Purchasing property in Dubai

Originally Posted by Grimps View Post
I've been wondering if it would be a good idea for me to buy a studio in the UAE , Ive been offfered a job with an all in salary and thought that rather than lose money in paying rent to someone I could own a place for a couple of years then sell it when I leave
NOT a good idea to buy right now
A studio in Disco is down to 380K and I have an going bet with my property guy that it will hit 270K by the end of this year, sad to say it looks like I might win the bet
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Old Apr 28th 2018, 10:42 am
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Default Re: Purchasing property in Dubai

Originally Posted by Irishbeekeeper View Post
NOT a good idea to buy right now
A studio in Disco is down to 380K and I have an going bet with my property guy that it will hit 270K by the end of this year, sad to say it looks like I might win the bet
Fair enough , I think I’ll hold off on that idea
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Old Apr 28th 2018, 11:09 am
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Default Re: Purchasing property in Dubai

To be fair, IBK reminds me of Ambrose Evans-Pritchard of the DT, forever predicting doom and gloom that never happens

He is right, however, that things are tight in the UAE.

That aside, Disco Gardens is probably not the best example to use. It's a housing estate rapidly turning into a slum. It was badly built, badly kept up, and now has to compete with newer areas like Sports City and DIP and whatever else is being built.

As the old saying goes, it's all about location, location and location. Prime areas like Marina or Greens or Downtown are much more resilient. There will always be a market for high end property and popular areas. The huge expat churn means most people seek to rent, not buy.

But it is always a gamble much so here than back home. I remember when many people said don't buy following the 2008-2009 crash, but those who did have come out well. Now lots of people are saying don't buy. But who knows what will happen over the next few years I wouldn't invest in the UAE unless I was willing to lose the money. I don't have that kind of risk appetite.
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Old Apr 28th 2018, 2:37 pm
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Default Re: Purchasing property in Dubai

One also needs to watch currencies as Dirham is tied to US$ - can make a difference when you sell presuming you want to convert to £.
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Old Apr 28th 2018, 4:37 pm
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Default Re: Purchasing property in Dubai

Originally Posted by DXBtoDOH View Post
To be fair, IBK reminds me of Ambrose Evans-Pritchard of the DT, forever predicting doom and gloom that never happens

He is right, however, that things are tight in the UAE.

That aside, Disco Gardens is probably not the best example to use. It's a housing estate rapidly turning into a slum. It was badly built, badly kept up, and now has to compete with newer areas like Sports City and DIP and whatever else is being built.

As the old saying goes, it's all about location, location and location. Prime areas like Marina or Greens or Downtown are much more resilient. There will always be a market for high end property and popular areas. The huge expat churn means most people seek to rent, not buy.

But it is always a gamble much so here than back home. I remember when many people said don't buy following the 2008-2009 crash, but those who did have come out well. Now lots of people are saying don't buy. But who knows what will happen over the next few years I wouldn't invest in the UAE unless I was willing to lose the money. I don't have that kind of risk appetite.
What can I say I am a realist (pessimist?)
btw you want to go uptown? I can assure you the property market uptown is suffering on a bigger scale. The more expensive they are, the larger the percentage fall. And I dont believe in not buying after the crash, I think one should buy after the crash and then wait it out. But right now the crash isnt here, it looks like its coming (hopefully not). Like I said, End of this year would be a right time to buy IF one wants to invest long term here, but why? invest long term now? I dont want to bang on, on a public forum, but lets just say the bet was placed on the wrong horse.
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Old Apr 22nd 2019, 8:37 am
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Default Re: Purchasing property in Dubai

Originally Posted by bhomes View Post
Buying a property in Dubai consist of 3 things
1) Expensive
2) Good ROI
3) Risk of job

UAE main income is real estate business because lots of expats migrating to UAE. And some of them are tired of paying monthly rentals. So it's similar like paying the mortgage to the bank as paying rent to the landlord.
The above criteria match for everyone in UAE so should invest accordingly to have a safe future or else will end up in the loss.
Consult better real estate agencies like Betterhomes, Propertyfinder, Bayut etc to get a market insight before investing.
Hope this helps
Cheers!!!
Let me get that right...

I should invest in a poorly-constructed, roller coaster property market to provide a safe future for myself? Investment advice from a RE company.... As much use as a chocolate fireguard...
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