Buying property in Dubai

Buying property in Dubai

In this section, we will fully explain what useful and practical information AKT will provide to AKT users.

With ideal amenities, suitable business infrastructure, the possibility of progress in various fields of work, quality schools and universities, and extremely unique designs in real estate in the UAE, whether residential or commercial, the UAE has always been the focus of those who invest in By purchasing property, they intended to obtain residency in this country. Also, residents who are looking to buy a house in the UAE have a similar and common concern when it comes to real estate in Dubai or other emirates. Our goal at AKT Real Estate is to respond as much as possible to issues related to buying or renting a house in the UAE for both categories of people.

To buy a house in Dubai, it seems difficult to choose an option among the numerous apartments, studios, or villas available with various costs and facilities. The cost of renting a house in Dubai and comparing the prices of apartments in different residential areas are always one of the most important questions for people on the verge of buying or renting a property in Dubai. In AKT Real Estate, we try to respond to this need by introducing businesses active in the field of real estate consulting in Dubai, as well as publishing the latest ads for buying or selling residential and commercial properties.

On the AKT Real Estate page, we introduce various businesses active in the UAE real estate sector. By viewing each of these real estate consultants, you can access comprehensive information about them, including their work experience and services, communication methods and contact numbers, current projects, etc. Comparing this information and reading the opinions of other users from the experience of working with each of these real estate consulting businesses in the UAE will help you in choosing the best broker to buy, sell or rent a residential or commercial unit in Dubai and other parts of the UAE.

Answers to all your questions about buying property in Dubai

The real estate sector is the most booming sector for domestic and foreign investors in the UAE, and billions of dirhams are invested in this sector every year in the hope of more profit. Over the years, Dubai has made the process of buying property easy and has gained the trust of investors, especially foreign investors who are looking for significant profits by buying property in Dubai.

Many wealthy individuals and entrepreneurs are moving their businesses to Dubai, and recent statistics show that the total transaction volume of the Dubai real estate market this May (2022) has reached its highest level in 13 years.

In the following, for investors who are interested in buying property in Dubai, we describe the steps and important points in detail.

What are the necessary documents to buy a property in Dubai?

If you, as a buyer, want to buy pre-sale or limited ownership property, you just need to present your passport and no special permit or document is required. In Dubai, properties are either leasehold or freehold. Limited ownership allows the property owner to own the property for 99 years (or less as per the contract). In principle, the buyer acquires only the right to use the property and not the ownership of the land to which it belongs. In contrast, full ownership gives both the right to use the property and the property itself to the buyer.

How long does it take to complete the property purchase process?

Normally, the process of buying a property in Dubai takes about four weeks from the day the sale is agreed upon. However, many factors may affect the process of this work, including the season, type of sale, etc. For example, a cash transaction is always faster than other transaction types.

What is the minimum amount of money we should have in cash to buy a property for AED 500,000?

It depends on whether the buyer wants to make a cash or installment transaction. In both cases, there are fees to be paid. The first cost of obtaining consent (NOC) from the property developer, is not a fixed amount and can be 1 to 5 thousand dirhams plus 5% value-added tax.

Then you have to pay a 2% commission to the real estate agent. DLD charges you an amount equal to 4% of the property value plus AED 340 for the land and AED 40 for pre-sale and finally, you have to pay the trustee fee which is AED 4,000 for ready property and AED 5,000 for pre-sale plus 5 The value added tax percentage is calculated.

What is the process of buying a property in Dubai?

First and foremost, finding a good real estate agent is critical. You need someone who is aware of your needs and desires and is familiar with the market conditions and the inconsistencies of the laws and has a reliable background. The process of buying a property is simple. After the two sides of the transaction have agreed on the terms, they should both sign the Agreement for Sale or Memorandum of Understanding (MoU).

At this stage, a deposit equal to 10% of the total amount must be paid to commit to the purchase. The seller then settles the remaining costs with the manufacturer, including service fees and pre-sale rights. Once all debts are cleared, the builder provides the seller with a consent form and a new deed is issued in the buyer’s name. By issuing this document, the ownership of the property is legally transferred from the seller to the buyer. Remember that on average, buying a property in Dubai takes about 30 days from the time the sale is agreed upon.

For pre-sale, a Sale and Purchase Agreement (SPA) is signed in which the estimated completion date is mentioned. When this agreement is signed, a contract document (Oqood) will be issued, which will serve as a temporary document until the official document is registered in the buyer’s name. The contract fee is usually 4% of the purchase price. After the completion of the property, the contract document is replaced with an official document in the owner’s name.

What documents must be completed to buy a property in Dubai?

When the seller and the buyer reach a verbal agreement, the seller signs a form called Form A in the broker agreement, and the buyer signs Form B with the broker. Then by filling out the F form, the deal is closed, which is also called MoU. At this stage, the buyer must pay the equivalent of 10% of the amount as a deposit.

How long can the property developer postpone the delivery date?

Building real estate is a complex process that requires a wide range of different experts and multiple and complex supply chains. As a result, even with the best planning, construction delays may occur, and builders have up to 12 months of late delivery after the announced date. If the property is not delivered within 12 months after the date announced in the contract, the buyer can complain to the builder.

When buying a property, is the cost of connection to municipal services also calculated?

Generally no. If the property is pre-purchased, the connection to municipal services will be made upon final payment and delivery of the property. However, if the property is purchased from the secondary real estate market and is not pre-purchased, the seller must settle the cost of municipal services with the builder and obtain consent before selling the property and delivering services to the new owner.

What are the minimum and maximum costs of charging the building in Dubai?

The cost range of the building charge is very wide and depends on factors such as the area, type of property, quality characteristics, facilities used, etc. For example, the cost of services in apartments in prime areas of Dubai ranges from AED 15 to AED 50 per square foot (about AED 160 to AED 538 per square meter).

Can the property be purchased in installments?

Yes, there are different types of prepayment and installment payments. The installment payment for the pre-sale of the property can vary from monthly installments during the construction process to monthly installments up to 5 years after the completion of the work. By paying in long installments until after the delivery of the property, you may no longer need to get a loan.

However, pre-sale installments (which usually include 40-60% of the total purchase price) may be very expensive. If using a home loan for a first-time home buyer, 20-25% of the total cost should be provided in the form of assets. The number and interest of the installments depend on factors such as the value of the property, the length of the installment period, the residence of the buyer, etc.

What is the minimum property price to receive a golden visa?

In April 2022, the UAE Cabinet changed the long-term visa rules and introduced the Golden Visa. This visa is valid for 10 years and is given to people who buy a property worth more than 2 million dirhams. This property can be pre-purchased or completed and can also be used as a loan guarantee in banks in the UAE.

What are the charges to be paid to Rera and DLD for property purchases?

DLD fee: 4% of property value plus AED 580 fee

Property registration fee for properties worth less than AED 500,000: AED 2,000 plus 5% value-added tax.

Property registration fee for properties worth more than AED 500,000: AED 4,000 plus 5% value-added tax.

Pre-purchase: To pre-purchase the property, you have to pay the cost of the contract document, which is calculated as 4% of the property’s value.

What if we are not able to pay the installments of the pre-purchased property?

In this case, the buyer must first contact the manufacturer and talk to reach a compromise agreement, such as changing the future installments, canceling the contract with a small fine, etc. If no agreement is reached, the manufacturer has the right to cancel the contract.

What are the most popular areas in the cheap, medium, and expensive range in Dubai?

Cheap: Jumeirah Village Circle (JVC), Jumeirah Lake Towers (JLT), and Damac Lagoons

Intermediate: Dubai Marina, Business Bay, and Arabian Ranches

Expensive: Palm Jumeirah, Downtown Dubai

What are the points that the buyer should pay attention to after buying the property?

Unit registration in Ejari

The cost of utility bills (water, electricity, telephone, etc.)

The cost of charging the building

Association of Owners

Entrust the property to a reputable property management company, especially if you do not live in the UAE.

Is it better to invest in buildings under construction or buildings ready for occupancy?

Both types of property have advantages and disadvantages for investment. Choosing between a building under construction and a ready-to-move-in building is important and depends on your investment goal and profit. Before making a decision, pay attention to things like the remaining time until the end of the work, liquidity, the desired area, profitability, the builder’s credit, and the quality of the builder’s previous projects and make the best decision depending on your current situation, but most importantly, make sure that the builder of your property It is valid.

Is it more economical to buy in cash or the form of a loan?

It depends on whether you intend to invest or not, and if you intend to invest, your goal is short-term or long-term. Buying in cash gives the buyer more choice and there is more possibility to negotiate the price and get a discount. In addition, with a cash purchase, there is no longer any need. The cash purchase loan interest is easier, faster, and cheaper (due to the lack of need to provide a guarantee for the loan) and is beneficial to both the seller and the buyer. Another thing that you should pay attention to is that there is always more risk in short-term investment.

Can foreign parents buy property in Dubai in the name of their children?

The minimum age to buy property is 21 years old, but parents can participate in real estate transactions on behalf of their children under 21 years old. However, to sell property belonging to a person under 21 years of age, a court order must be issued first.

Do you have experience in buying, renting, and generally buying property in Dubai? Write to us.

In addition to this, in the AKT real estate section, you can publish an ad to buy, sell or rent your desired property in the UAE and make your desired transactions at the lowest cost and without the involvement of intermediaries. In the end, we recommend that you regularly visit the AKT Real Estate website to view the latest options offered for the property purchase ad in Dubai.