Real estate transactions in Dubai
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Dubai is a haven for property buyers, but there are a lot of things you must consider and plan in order to land the best deal.
Here’s what you should consider when buying real estate in Dubai:
Research what fits your property needs
Assess preferences for apartments, townhouses or villas to understand property variations. Consider financial implications tied to location, surroundings, amenities and community classification.
Select a reliable agent
Select a property agent who understands your requirements and offers smooth guidance. Make sure the agent has a valid license and also a proven history of success.
Leasehold vs. freehold
The distinction in ownership lies in the type of property rights granted. Leasehold provides restricted property rights within a specific time period, whereas freehold grants unrestricted and permanent ownership rights. Freehold is generally favored due to its superior advantages. Make a decision according to your needs and communicate your preference to your agent.
Legal matters
Individuals who are not UAE residents have the opportunity to buy property in Dubai’s freehold areas, without any restrictions based on nationality or location.
Schedule property transactions
Allow at least 30 days for the completion of a property transaction. Considering variations depending on factors such as buyer type and time of year.
Step-by-step guide of Dubai property transactions:
Step 1. The buyer and seller sign an Agreement or Memorandum of Understanding when an agreement into the property sales terms is reached. The buyer will then need to make a 10 percent deposit on the property price.
Step 2. The seller settles fees and obtains an No Objection Certificate (NOC) from the developer for a one-time fee, allowing the property to be sold.
Step 3. In case the buyer is getting a bank loan to buy the property, then the buyer’s mortgage involves lender and seller’s mortgage settled before an NOC application.
Step 4. The NOC is issued prior to the ownership transfer at Dubai Land Department offices. Payment is made through a manager’s cheque. Subsequently, the purchaser acquires a fresh title deed.
Stay on track with proper documentation
1. Buyer and seller IDs
2. Property title deed
3. NOC from developer
4. Seller service charge clearance letter
5. Bank offer letter to buyer (in the case of a mortgage buyer)
6. Proof of mortgage settlement
7. Final bills: DEWA, cooling charges
Additional costs to expect
1. NOC cost varies from Dh500 to Dh5,000. Some developers require a refundable deposit.
2. Dubai real estate agent commission: 2 percent plus VAT
3. Transfer fees: 4 percent of purchase price plus admin fees
4. Trustee fees for ready properties: Dh4,000 plus VAT. For off-plan properties: Dh5,00 plus VAT. Payments must be made at DLD trustee office
5. Mortgage registration fee: 0.25 percent of loan amount. Pay at Dubai Land Department
6. Also consider payment of pro-rata service charges requested by developers
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