Frequently Asked Questions
General
The Dubai real estate market has seen [insert current trend, e.g., steady growth in certain sectors, increased demand for luxury properties, etc.]. Keeping an eye on these trends can help you make informed decisions.
Foreigners can buy property in designated freehold areas in Dubai. They need to ensure they meet all legal requirements, including obtaining a residency visa or having a business registered in the UAE.
Costs typically include the property purchase price, agent commissions (usually 2% of the property value), Dubai Land Department fees (4% of the property value), and possibly mortgage arrangement fees if financing is involved.
You can verify a developer's authenticity by checking their registration with the Dubai Land Department (DLD) and reviewing their track record of completed projects.
Ejari is a system for registering rental contracts in Dubai. It is essential for legalizing tenancy contracts and is required for residency visa applications and DEWA (Dubai Electricity and Water Authority) connections.
In Dubai, property ownership can be freehold, leasehold, or usufruct. Freehold ownership allows full ownership rights indefinitely, whereas leasehold and usufruct arrangements are for specified periods.
Residential areas in Dubai offer a range of amenities such as parks, schools, shopping centers, and recreational facilities. The availability and quality can vary by neighborhood.
Buying and Selling
The steps typically include:
- Identify a property and negotiate terms.
- Sign a Memorandum of Understanding (MOU) or Sale and Purchase Agreement (SPA).
- Pay a deposit (usually 10%).
- Obtain a No Objection Certificate (NOC) from the developer.
- Register the property with the Dubai Land Department (DLD).
- Pay fees and transfer ownership.
Financing options include mortgages from banks in Dubai, which typically offer loans of up to 80% of the property value for residents and up to 75% for non-residents. Interest rates and terms can vary.
Verify the property's legal status by obtaining a Title Deed from the Dubai Land Department (DLD). This document confirms ownership and details about the property.
The steps generally include:
- Choose a real estate agent or list the property yourself.
- Determine the selling price based on market analysis.
- Sign a listing agreement.
- Market the property and conduct viewings.
- Negotiate offers and accept terms.
- Sign the Sale and Purchase Agreement (SPA).
- Transfer ownership at the Dubai Land Department (DLD).
Costs typically include agent commissions (around 2% of the sale price), Dubai Land Department fees (usually 2% of the sale price), and possibly early mortgage settlement fees if applicable.
Sellers must ensure all outstanding fees (such as service charges) are settled, provide necessary documents for transfer, and disclose any known defects or issues with the property.
Payment
Accepted methods typically include bank transfers, manager's cheques, and sometimes cash payments for smaller amounts. It's important to confirm preferred methods with the seller or developer.
The final payment is typically made at the completion of the property transaction, which includes signing the Sale and Purchase Agreement (SPA) and transferring ownership at the Dubai Land Department (DLD).
VAT (Value Added Tax) in Dubai applies to certain services related to property transactions, such as agent commissions and legal fees. It is currently set at 5% and should be factored into your budgeting.
Yes, banks in Dubai offer mortgage financing options for property purchases. Residents can typically obtain loans of up to 80% of the property value, while non-residents can usually get up to 75%.
Support
First of all, you have to know that while it is perfectly legal to sell off-plan property in Dubai, developers set certain restrictions in order to keep these transactions under control. Most companies allow a resale, once 30-40% of the total property value is paid off, and a payment plan can be transferred to the new owner.
So, upon paying a minimum required amount and obtaining approval from the developer, you can start searching for a potential buyer, with the help of an experienced real estate broker. The buyer and seller have to finalize both the terms and the price, sign contracts and also obtain an NOC in order to register the new buyer.
Finally, once the transfer is complete, the new owner will take over all the outstanding payments. It is essential to know that the new purchaser is responsible for paying the 4% DLD Transfer Fee, even though it would have already been paid by the initial buyer.
To begin with, the investment property market in Dubai offers higher rental yields than many other mature real estate markets. In fact, the average ROI here ranges between 5% and 9% as property prices per square foot are significantly lower than in other cities across the globe, such as London, Hong Kong and Paris. Thus, it is an affordable location to own luxury real estate, besides, there is also no stamp duty and property taxes as well.
In order to attract more investors, in September 2021, the DLD had reduced the minimum required amount, which allows purchasers to apply for a 3-year residence visa through investment, from AED 1M (USD 272K) to AED 750K (USD 205K). Visa holders can avail family sponsorship, which enables bringing a spouse and children to the country as well.
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