A Complete Guide to Buying Property in Dubai - Driven Properties

There are many things to consider when considering buying a new home. You might find the process overwhelming if you`re planning to buy a property in a city you`re not familiar with or even if it`s your first home. You need a place to start from, then go step by step throughout the buying process in Dubai, and the whole thing will become more apparent.

You first need to start by deciding what you`re looking for. As simple as it seems, this particular step requires making some decisions that could seem obvious but call for awareness of some things. So if you are looking to buy a property in Dubai, this complete Dubai property guide is about the property types, off-plan projects, best locations, prices, and more. Learn more.

Set your Purpose: Family Home or Investment Property?

There are significant differences between choosing the home you want to live in and a property you want to buy as an investment. The differences revolve mainly around the lifestyle, location, size, type, and, most importantly, ready or off-plan properties.

Services and Facilities You Get when Buying Property in Dubai

This depends on your lifestyle or the kind of life you`d like to have by buying this property when it`s a family home purchase. However, if it`s a property investment in Dubai, it`s important to focus on the availability of services in a big city like City Walk Dubai. This includes metro stations, bus stations, schools, clinics, parks, entertainment places, or basic assets of the area where the property is. As well as the facilities provided by the building or the community like swimming pools, gyms, playgrounds, and sports courts.

The Fundamentals of Purchasing Property In Dubai

Who Can Buy Property in Dubai?

Anybody of any country or origin can buy freehold property in Dubai. The buyer is not requested to have UAE citizenship or residency status. Buying real estate in Dubai requires no particular visa or other documentation.

What are my options for purchasing property in Dubai?

The type of property you choose can affect the style of life you live. Consider investment. Decide how profitable your property investment in Dubai is. You must determine if you want to live in the house or want it to be an investment before deciding on the type of property you want. Studios and small apartments are better choices for investment than large apartments or villas. Smaller-sized properties are easier to rent or sell if you decide to sell your property in Dubai.

Buying a home for you and your family requires thinking of your present and future needs. If you anticipate your family getting larger, you will need more space for a comfortable lifestyle. A villa or a townhouse with many bedrooms would be a good choice as it will offer the space you want and the privacy you need.

What`s next? Dubai is an approvingly competitive choice compared to international cities like Singapore, London, Sydney, New York, and Shanghai regarding luxury properties, offering high-end luxury living standards at a price far more reasonable than any other cosmopolitan city globally. Therefore, investing inluxury properties in Dubai remains a lucrative opportunity for investors and high-net-worth individuals worldwide.

Benefits of Buying Property in Dubai 

Dubai has become a global hotspot for real estate investment. With its booming economy, luxurious lifestyle, and world-class infrastructure and amenities, it`s no wonder why people are drawn to this city. From tax-free benefits and high rental yields to a stable political environment, owning property in Dubai is a big benefit. Discover why so many are choosing Dubai as their number-one property investment destination. Learn more about the top 10 reasons to invest in Dubai

Invest in Off-plan Properties in Dubai

Off-plan or properties under construction are mostly more affordable than ready-to-move-in ones. However, considering there is a waiting period between the purchase and receiving of the property, the price you pay for an off-plan property is a catch, as the property`s value will increase eventually once the construction is complete.

The process involved in buying off-plan properties in Dubai: 

• The buyer and the developer agree on the terms of the sale and the property price 
• A reservation agreement is signed and the buyer pays the reservation fee and/or the first installment of the purchase price, the amount of which is specified by the terms of the agreement 
• A Sales & Purchase Agreement (SPA) is signed, which includes the expected completion date of the property 
• Once the SPA has been signed, an Oqood document is issued, which serves as a temporary registration until the buyer has the title deed. An Oqood fee is also paid at this time, typically 4% of the purchase price. 
• The buyer continues to pay timely installments as per the approved payment plan until the balance has been fully paid 
• Once the property is completed, the Oqood becomes a title deed in the name of the new property owner

Invest in Ready-to-Move-in Properties in Dubai

Suppose your goal is to have the property to live in or start renting and availing from its income as soon as possible. In that case, buying a ready to move in properties will make much more sense. But if you can sacrifice the wait for a higher quality home or a better location within the same price range, go for off-plan.

The process involved in buying ready-to-move-in properties in Dubai: 

• The buyer and the seller agree on the terms of the sale and the property price 
• Both buyer and seller sign a Memorandum of Understanding (MOU) before proceeding with the property`s conveyance, outlining the terms of the agreement. The MOU must be registered with the DLD. A 10% deposit is paid at this time. 
• Both parties must apply for a No Objection Certificate (NOC) from the developer so the property can be transferred. There is a fee for the NOC issuance. 
• The transfer of the property must be officially registered with the DLD, and a transfer fee of 4% must be paid at this time 
• As per DLD regulations, the buyer must pay in the form of the manager`s cheques payable to the seller on the property transfer date. If the buyer is paying with the help of a mortgage, then a bank representative must be involved in the completion of the relevant paperwork and formalities 
• If the seller has any existing mortgage on the property at the time of the sale, it is the buyer`s responsibility to settle the mortgage before applying for the NOC 
• Once all of the above formalities have been completed, a new title deed is issued in the name of the buyer, and the property is officially transferred from seller to buyer 

Prime Locations to Buy Property in Dubai

This might be the most important factor you should consider when planning to buy your new home or even to rent property in Dubai.

The location of your property plays an essential role in your quality of life and the worth of the investment. When buying a home for your family, it`s very important to choose a location that ensures you can spend as little time transporting between home and the places you and your family members visit every day as possible. It`s necessary to try driving to the location of the home you intend to buy before purchasing to test the time you need to reach it from your everyday destinations at different times during the day, especially during the high traffic hours.

When buying a property investment in Dubai, you need to choose a location sought after by tenants or buyers to guarantee it won`t stay empty for long whenever you put it on the market.

What is the Average Price for a Property in Dubai?

First, you need to be clear about your financial situation. Whether you have savings that you can rely on or want to apply for a mortgage, find out the maximum price you can put on a property without pushing yourself. Try to find out the approximate amount you`re eligible for as a home loan before looking, so you can look for the properties you know you can afford. The average price for a property in Dubai is about AED300,000-350,000. Even lower than 300,000 you can buy an International City studio closer to AED260,000-270,000. USD 100,000 is the kind of average entry-level in Dubai

What Documentation Do I Need to Buy Property in Dubai?

You need to provide some documents that you will find below. The nature of documents varies depending on whether you buy as an individual or a corporate entity. The list is subject to change and will also vary between companies. Therefore, buyers must check with the Dubai Land Department before completing any transaction.

Documents Required For an Individual Buyer:

• Buyer`s passport 
• Legal ID 
• Proof of address 
• Contact Details 

Documents Required for Corporate Buyers:

• Original Certificate of Incorporation or Trade License 
• Original Memorandum and Article of Association 
• Legal translation of the memorandum and articles of association 
• Original certificate of incumbency (not more than 3 months old) 
• Copy of shareholders` passports 
• Original resolution approving the purchase 
• Original POA 
• Original passport of attorney

What are the Legal Factors to Consider Before Buying a Property in Dubai?

You should take on a legal advisor familiar with Dubai property laws to oversee the transaction before deciding on buying property. Suppose you are being represented by a Power of Attorney. In that case, the POA document must be notarized in the country where it is signed, which will be legalized by the UAE Embassy in that country. When the document comes to the UAE, it must be certified by the Ministry of Foreign Affairs and translated into Arabic. For buyers living in the UAE, the signing of the POA must be witnessed by a Notary Public. As per DLD regulations, a POA cannot be more than two years old. A certified legal translator must translate all documentation submitted to the DLD into Arabic. Documents not in Arabic or without an Arabic translation will not be considered valid for real estate transactions.

How does VAT Factor into my Property Purchase in Dubai?

Though this primarily applies to commercial properties, certain real estate transactions in Dubai are taxable. Now, VAT is not charged upon residential property transactions in Dubai. We suggest checking on the latest regulations with a legal advisor or one of our trusted private client advisors. They can provide you with the most up-to-date information.

Can I Get a Residence Permit if I Buy Property in Dubai?

Property buyers in Dubai are given a 2-year residence permit, which is repeatable. The lowest investment for a permit is AED 1 million, and the property must be in a freehold location. The permit also allows for sponsorship of dependents, including personal staff and domestic workers. Property owners should not stay outside the UAE for more than 6 consecutive months for the permit to remain valid.

Where Can I Buy Property in Dubai?

Visit Driven Propertiesand browse through the area guides showing the different communities in Dubai. Then look at the transaction records to know what is popular or the service charges per community or project. Other helpful information can help you decide on the property you want.

Conclusion

Dubai, a city of dreams, turns your dreams into reality through property ownership. With its dynamic economy, world-class infrastructure, and unparalleled lifestyle, investing in Dubai real estate is a safe and sound proposition.

This comprehensive Dubai property guide has endeavored to equip you with the essential knowledge to navigate the property market confidently because it covers key aspects.

Take this rewarding property ownership journey in the heart of Dubai. Your journey to Dubai property ownership starts with Driven Properties.

FAQs

1. What types of properties are available for purchase in Dubai?

All types of properties can be found in Dubai:

Residential Properties:

• Studios 
• Apartments(1,2,3,4,5 bedrooms) 
• Villas 
• Townhouses 
• Penthouses 
• Lofts 
• Duplexes 
• Houses 
• Off-plan properties

Commercial Properties: 

• Offices 
• Retail Spaces 
• Shops 
• Malls 
• Commercial centers 
• Hotels 
• Services apartments 
• Warehouses 
• Factories 
• Logistics centers

2. What mortgage options are available for property purchase in Dubai?

Dubai property prices have experienced significant growth in recent years. Dubai offers a variety of mortgage options to suit different financial situations:

• Fixed-rate mortgages: Provide stability with consistent interest rates. 
• Variable-rate mortgages: Offer potential for lower interest rates but involve more risk. 
• Investment mortgages: Designed for properties purchased as investments. 
• Islamic mortgages: Compliant with Islamic finance principles, offering interest-free options.

Dubai offers a range of mortgage options for property purchases, with terms typically up to 25 years. Lenders often provide up to 80% financing for properties under AED 5 million, and slightly less for higher-valued properties. Factors like income, property value, and lender policies influence the maximum loan amount. Additionally, options like flexible repayment plans and different loan tenors cater to diverse buyer needs.

3. What are the costs involved in buying property in Dubai?

Buying property in Dubai involves various costs beyond the purchase price.

These include government fees (Dubai Land Department fees, property registration fees, mortgage registration fees), agent and brokerage commissions, bank and mortgage-related charges (arrangement fees, valuation fees), property valuation fees, insurance costs (home and contents, life insurance), potential legal and conveyance fee, and service charges covering building maintenance, security, and amenities.

4. Are there any taxes on property purchases in Dubai?

Currently, there are no property purchase taxes in Dubai. This is one of the reasons why Dubai has been a popular destination for real estate investment. 

5. What are the common pitfalls to avoid when buying property in Dubai?

Buying property in Dubai can be exciting but be aware of potential pitfalls. Here are some common mistakes to avoid:

• Lack of Due Diligence: Thoroughly investigate the property, developer, and market conditions before purchase. 
• Ignoring Hidden Costs: Be aware of additional expenses beyond the purchase price, such as agency fees, government charges, and maintenance costs. 
• Rushing the Buying Process in Dubai: Take your time to consider all options and avoid impulsive decisions. 
• Overlooking Property Location: Consider proximity to amenities, transportation, and future developments when deciding on a property. 
• Failing to Understand Dubai Property Laws: Be aware of Dubai property laws and regulations. 
• Ignoring Legal Advice: Seek professional legal counsel to protect your interests throughout the buying process in Duba. 
• Overborrowing: Taking on a mortgage that stretches your financial capabilities can lead to financial difficulties.

Being aware of these common pitfalls can increase your chances of a successful property purchase in Dubai.