Six stress-free steps to buying real estate in Dubai
With year-round sunshine, a cosmopolitan lifestyle and excellent business opportunities, Dubai is a property hotspot, attracting thousands of eager investors every year.
But, while buying in the emirate is a relatively straightforward process, it pays to understand each step from the outset, helping to avoid hidden pitfalls so you can enjoy a stress-free exchange from start to finish. Follow our top tips to successful purchase and you won’t go far wrong:
Step 1: Choose the location
When you have decided whether you’re buying the property to live in, to provide rental income or to appreciate your capital, think about the property type. Are you looking for an apartment or a villa, and in which area would you like to buy?
Step 2: Calculate your finances
Work out your budget, factoring in additional fees in the purchasing process such as a 4% transfer fee of the purchase price, plus AED580 for title deed processing both of which are payable to the Dubai Land Department. Administration fees account for AED4,000 and are payable to the registration centre where the transaction takes place. There is also a brokerage fee of 2% of the selling price, and a conveyance fee that ranges from AED1,000 to AED5,000 depending on the type of property and type of transaction, whether it is cash or a financed purchase. An additional cost is the maintenance fee, which is payable to the developer from the date of transfer, after you have bought the property.
Step 3: Factor in extra costs for mortgages
If you are purchasing with a mortgage, you must keep in mind the mortgage registration fee of 0.25% of the value of the loan, payable to the Dubai Land Department.
Step 4: Provide documentation
With finances firmly in place, you can make an offer on a property, but to do so you must provide passport copies for all buyers. If you are buying through a company, you will need to provide several different forms of documentation, including a Certificate of Incorporation, Memorandum and Articles of Association, Board Resolution and Power of Attorney. If the company is based overseas, all documents must be notarized and attested by the UAE embassy in the country of origin, stamped in Dubai’s MOFA, and legally translated into Arabic. All documents must be completed for transfer day.
Step 5: Oversee the contract
When the offer has been accepted, the brokerage draws up the Memorandum of Understanding (MOU) and payments are collected. These include 10% of the agreed asking price as a deposit in the seller’s name to secure the property, the brokerage fee and conveyancing fee. On the plus side, the payments are not banked until the property’s transfer date.
Step 6: Transfer ownership
This final stage, which takes place at an authorized registered office, is where the property formally changes hands. A variety of documents are required including the title deed or OQOOD, valid passport copies for both buyer and seller (or ID for Emirati Nationals), the Sale Transaction Contract – Form F, and developer’s NOC. The settlement cheques made out to the seller are also required as well as the Dubai Land Department fees and the buyer’s brokerage fee.
Your Oryx World Portfolio consultant will guide you through each step of the buying process, and an in-house Transaction Manager will handle every aspect of your conveyance to ensure a hassle-free transaction. For more information on the purchasing process, please call Oryx World Portfolio today on +971 (0) 4 446 2000.
This article offers general information on purchasing a property in Dubai. It does not constitute legal advice. Please consult a local law firm or property specialist for more specific details.