More and more people are toying with the idea of buying a home in Dubai. The city has been extremely popular for years due to economic and tax issues. Dubai now also offers an extremely high quality of life and living.
As a result, interest in buying a house in Dubai has risen sharply.
Everything you need to know about buying a house in Dubai in this article. From the requirements and the best areas to the costs and process.
Prerequisites
Citizens of the United Arab Emirates (UAE) or the Gulf Cooperation Council (GCC) can buy property anywhere in Dubai, while foreign investors can only buy property in the foreign-owned areas designated by the Ruler of the Emirate of Dubai. These areas are:
- Palm Jumeirah
- World Islands
- Downtown
- Old Town
- Burj Khalifa
- Business Bay
- Dubai Marina
- Emirates Hills
- Jumeirah Lake Towers (JLT)
- Jumeirah Beach Residence (JBR)
- Discovery Gardens
- Arabian Ranches
- Midriff (certain properties)
- Dubai Investment Park (DIP)
- Falcon City
- Dubai Sports City
- Dubai Motor City
- Dubai South
- International City
- Jumeirah Islands
- Jumeirah Village
You do not need a visa to buy a property in Dubai as a foreign investor. In fact, buying a property often means that you can apply for a visa to stay. You can find a selection of houses for sale in Dubai here: https://www.dubaiimmobilien.com/objekte/haus/kaufen
Decisive factors
Before buying a house in Dubai, you should definitely consider the following factors.
Location
One of the most important elements to consider before investing in real estate in Dubai is the location. Individuals looking to invest in an apartment or luxury home in Dubai should research the best locations for future real estate investment. Some of the best locations in the city, such as Dubai Marina, have a range of facilities that allow for a high-end lifestyle.
Therefore, investors should look for such locations that could be beneficial to them. Searching for such properties can be time-consuming; however, Real Estate provides you with a list of the best properties in Dubai in ideal locations that can offer long-term returns to foreign buyers.
Market statistics
It is certainly difficult to decide on a specific location when there is a wide range of very tempting options to choose from. To get the best return on your investment, you should definitely start with your personal research on the real estate market.
As an interested investor, you can also find out about the current trends, predictions and patterns in financial investments. Newer projects for investment in Dubai such as Costa Brava, Santorini and Eterno Prestige Villas can be more attractive to investors. The more you research, the more benefits you can reap from the UAE real estate market.
Tenancy
Before investing in the Dubai real estate market, you should consider how long you plan to stay in the UAE overall. This is important as it will help you determine the overall value you can derive from your potential return on investment. However, if you are not sure how long you plan to stay in the UAE, it is better to rent a property.
Affordability
One of the most important factors considered when buying real estate worldwide is affordability. A person’s monthly housing costs should not exceed 25% of their total income. Your budget should also be sufficient for upfront costs. These can account for almost 9% of the total purchase price of the property.
Maintenance costs
As a property owner in Dubai, you also need to keep an eye on maintenance fees and the payment of annual service charges.
Returns
If you are thinking of renting out your property in Dubai, you should focus on how much monetary profit you will make. This will give you a better idea of whether the potential rental income will be sufficient to cover your repayments, mortgage and maintenance costs.
As a rule, investors can achieve a gross yield of between 5% and 9%.
VISA / Residence permit
Property worth AED 2 million or more in the UAE can help you obtain a residence visa. This may be subject to certain guidelines.
There are two main types of residence visas available in the UAE. One is a six-month visa for multiple entries. The other is a two-year residency visa. Property owners also have the option of sponsoring residence visas for their families.
A property in Dubai worth at least AED 2 million enables investors to obtain a Golden VISA for 10 years. We will be happy to help you find the right property and obtain it.
Investment or personal benefit
There is a difference between buying a house for personal use and renting it out to generate a return.
Investment
The real estate market in the United Arab Emirates is very popular, and there are many advantages to buying a home in Dubai. These include high rental yields, high market capitalization and a transparent process for businesses. Most foreigners or expatriates hope to buy an affordable home in Dubai that will give them a high return on investment. A thorough evaluation of the market can help in buying a home in Dubai at a good price.
Personal benefit
Over the years, Dubai has developed into a huge real estate and business center. The city is now home to numerous expatriates from different parts of the world. Real estate in Dubai is often considered very expensive and unaffordable for many foreigners working as laborers.
But that has now changed. People who are employed or have their own business in Dubai are now more inclined to buy their own properties rather than rent them out. As the government has lifted certain restrictions on property ownership, buying property in Dubai is no longer as complicated for foreigners.
If your personal motive for buying a property in Dubai is to live, then make sure that the location is close to hospitals, supermarkets, restaurants and schools. Raising your family in a progressive and developed city like Dubai can be a very rewarding experience.
Procedure
The procedures for buying a property in Dubai are easy to follow.
1. contract between buyer and seller
Once you have found the right property on Propertyfinder or dubaiimmobilien.com, the first step is to negotiate with the seller and set the terms of sale.
When buying a property in Dubai and the United Arab Emirates, you have two options: Paying cash or applying for a mortgage. The ability to negotiate is perhaps the biggest advantage of buying a property in cash or with a mortgage. Cash buyers have a better idea of their budget, so they can negotiate a lower price.
You can complete this stage without the help of a real estate agent or lawyer. Any reputable real estate agent in Dubai or any company that takes care of legal compliance should handle the rest.
When agreeing the terms of sale, make sure that there are no ambiguities between you and the seller regarding the selling price, payment terms or other important factors.
2. signing of the contract
The second legal step in buying a property in Dubai is the signing of the purchase agreement, also known as the Memorandum of Understanding (MOU).
The Letter of Intent or Form F in Dubai is one of the RERA real estate forms. The Form/Contract F is available on the official website of the Dubai Land Department. Usually, the real estate agent will prepare the contract for you.
Once the contract is finalized, the buyer and seller must sign it in front of a witness (usually the broker) at the office of the registration trustee.
The buyer must also pay a standard 10% deposit for the property to the registration trustee, which will be returned once the transfer of the property is complete.
3. application for a clearance certificate
The buyer, the seller and the real estate agent must meet at the developer’s office (e.g. Dubai Properties, Emaar Properties, Nakheel Properties or other leading developers in Dubai).
The purpose of this meeting is to apply for and pay for a No Objection Certificate (NOC) for the transfer of the property. The developer will only issue the NOC if there are no outstanding charges for the property.
4. transfer of ownership by DLD
Once you have received the NOC, the final legal step in buying a property in Dubai is to meet with the seller at the Dubai Land Department office to make the transfer effective.
In order for the transfer of ownership to take effect, you must have the following documents ready before you visit the DLD office:
- A manager’s check payable to the seller for the price of the property
- The original identification documents of the buyer and the seller (Emirates ID, passport)
- The original NOC issued by the developer
- Signed contract F (MOU)
Once the formalities have been completed, a new title deed will be issued in your name and you will officially become the owner of a property in Dubai.
Costs
Buying a house in Dubai comes with certain costs. It is important that you get an idea of all the fees associated with buying a house in Dubai in advance. This is important in order to calculate your budget accordingly.
- NOC fees: NOC fees are usually between AED 500 and AED 5000 and can be paid directly to the real estate or property developer.
- Registration fees: Approximately 4% of the total purchase price of the property can be paid to the DLD.
- Real estate agent’s commission: This amounts to almost 2% of the purchase price of the property.
Apart from the potential costs, additional fees may also be incurred. These may apply to both the developer’s office and the DLD. You may also have to pay fees for a community/building to the developer.
Popular communities
Below is an overview of the most popular communities for buying a home in Dubai. Dubai is now very large and you should know the different areas and their advantages before making a decision
Dubai Hills
Dubai Hills lays claim to being the most environmentally friendly area, and this is not surprising as an impressive portion of the area is set aside for parks and gardens. It is a self-sufficient community – a ‘city within a city’ that offers absolutely everything you need for comfortable and luxurious living.
The project consists of villas, townhouses, mid-rise houses and residential plots on an area equivalent to 200 soccer pitches. No other development in the region can boast such a size. The buildings in Dubai Hills represent a special form of art. They can surprise anyone with their beauty and harmony.
Dubai Hills is popular with families with young children as the area has four schools, a large park with playgrounds, a volleyball court, a tennis court, a skate park, bicycle paths, swimming pools and landscaped recreational areas with hammocks. For young professionals who prefer a busy life, this is a place where they can relax and escape from the daily routine. As the project is still under construction, this place is also attractive to investors.
Arabian Ranches
Arabian Ranches is a gated villa development in Dubai that opened in 2004. The development consists of three phases, the third of which has not yet been completed. To date, there are almost 6,000 homes in the area, as well as shopping centers, a golf club and an equestrian center.
The average rental yield in Arabian Ranches is 4.9% and the average price for a villa is around AED 6.2 million, which is approximately USD 1.7 million or £1.4 million. The cheapest properties in Arabian Ranches are located in Al Reem, while the most expensive villas can be found in Polo Homes.
Al Barari
Palm Jumeirah
The Palm Jumeirah, built between 2001 and 2006, is a series of man-made islands in the Persian Gulf. With a mix of commercial and residential units, the area is very popular with investors and tourists. The average selling price for a garden home is AED 18.5 million, which is USD 5 million or £4.3 million.
The average gross rental yield for garden apartments is 3.39%. The tourist nature of the Palm Jumeirah makes it a fantastic place to invest in short-term rental opportunities.
Summary
Buying a house in Dubai can be both a lucrative investment and a great improvement in quality of life. However, there is a wide range of properties on offer and it is important to familiarize yourself with the different areas.
Ideally, you should seek advice from a local expert who will find the right house for your individual needs.
In any case, we will be happy to assist you with advice, the search and the purchase of your home.
