Step by Step Guide 30 Apr 2020
A Step By Step Guide On How To Buy Property In Dubai
Are you an expat living in the UAE? If you are provided with an opportunity to buy property in Dubai, what are you going to then? In most cases, you will go for it. After all, Dubai is now one of the fastest-growing cities in the world that boasts of a strong infrastructure and is considered a major business hub. Besides, it is also fast becoming a global tourist destination.
Is it possible for expats to buy a property?
The 2002 Freehold Decree announced by Crown Prince of Dubai opened up several avenues for expats in terms of buying property. This legislation now made it possible for foreigners to buy, sell, lease, or rent property, without having to face too many constraints. As such, you don’t need any special permission, when it comes to buying or investing in property.
Because of the drastic rise in the rentals and on account of the healthy competition in the market, buying property is fast turning out to be a viable prospect for expats in Dubai.
Understanding the legal proceedings
To start with, a person of any nationality, living in Dubai as an expat as well as a resident in Dubai is allowed to buy freehold property made available in designated areas. There is no need to hold any type of residency or permit while trying to secure a property of your choice.
Once you have selected a property, the transaction process to get complete can take up to 30 days to complete, especially from the date on which the agreement was signed. A lot depends on the developer and the seller, other than the prevailing circumstances.
The underlying procedures
Considering the nature of the transaction, there are some procedures that must be followed.
- Buyer and seller agreement is a must
- A MOU (Memorandum of Understanding) is signed between the two parties and a minimum of 5-10% is deposited.
- Both the buyer and seller meet at the office of the developer to apply for a No Objection Certificate.
- The developer will issue the NOC against the payment of a fee, once it is evident that any amount payable to the developer in the form of service charges has been paid in full.
- After the issuance of NOC, both the seller and the buyer need to pay a visit to the Dubai Land Department, in order to officially transfer the ownership. When all the proceedings get over, a new title deed will be issued in the name of the buyer.
- In the event, where the buyer is purchasing the property with a mortgage, then it becomes necessary to involve the bank. If the seller has a mortgage on the property, then the buyer is required to settle the seller’s mortgage in full, prior to the applying of NOC.
This is a complicated procedure and it is advised not to get involved in such a transaction, as it increases the risk on the part of the buyer.
Fees & Taxes on Dubai Property
Apart from the legal fees, there are other expenses that must be paid back to the developer, or in some cases to the real estate agent. Keep in mind that you might have to pay a land registration fee as well as maintenance expenses.
The maintenance fees are utilized for the upkeep of the property or residential building as well as gardens and other facilities such as lift and so forth. In most cases, the costs vary and depend on the overall size of the property and similar factors. Sometimes, the accumulated costs in terms of maintenance can be a major headache.
This is why it is often advised to select a property that is easy on the pocket and offers everything you look for.
How to secure a mortgage as an expat in Dubai?
It might be impossible for you to pay the whole amount upfront, as far as the property is concerned. In that case, you might have to seek a mortgage from the banks and financial institutions to cover the costs.
Being an expat, you will have to present the following, while applying for a mortgage:
- Passport copies
- Proof of residence
- Address proof
- Evidence of regular income and salary certificates
- Bank account statements for the past 6 months
It is important to remember that the mortgage repayments in combination with other expenses should not exceed 35% of the monthly income. Moreover, the total mortgage amount is by and large limited to a figure no more than 60 times that of the combined household income.
Find a Suitable advisor
Of course, when you are looking forward to buying a property in Dubai, there are several technicalities involved. The proceedings might confuse and because of the legal framework, you are going to need some expert advice. In such a scenario, we at Gold Pillars Properties can provide you with all the answers to your many problems.
Since we are one of the leading real estate agents in Dubai, our innate understanding of the property market will help you snag a property of your choice. Our customer-centric approach is optimized to provide all possible support and this is what makes us popular with most of the people.