There’s a lot to consider when buying a property in Dubai. Here’s our guide of what you need to consider:
Do you require a new-build or an existing ready property? With some developers offering extremely attractive payment plans on off-plan projects; such as paying only 30% upfront and the remainder upon completion, it gives the chance to purchase to those who were originally priced out from buying off-plan. However the secondary market can enable buyers to mortgage a property with just a 25% down payment which may be a bit more realistic for some. Something else to keep in mind is that buying off-plan can be a risky asset as completion dates can vary and developers may halt the build etc, making the secondary market a much lower risk purchase. However, this lower risk comes with a higher price tag, as secondary market properties typically tend to be more expensive.
When searching for a property and dealing with an agent, always ask them to display their RERA registered broker number when you first meet. They will typically display their RERA card as proof. It may also be worth asking for some references from their previous clients.
When buying, you need to keep in mind the longevity of this purchase. In 5 years time, you may have a family; how good is the surrounding area for children? How well rated are the nurseries and schools nearby? Also consider long-term developments coming up around the area such as malls, schools and hospitals. For example, buying in Dubai South may seem a bit further out that other villa communities, however with Expo 2020 not far away, the development of the metro lines and surrounding communities will make it a hot spot to live within the next few years.
It’s not enough to just look at the community; when buying you also need to consider the specific building or complex you are purchasing a unit in. Is the developer well-respected with a good track record? Is the building maintained well? What are the service fees? Speak to neighbours and those you see when viewing the property. They are your best source for information on the building, complex and developer.
Make sure you are prepared for all of the costs associated with moving so you can budget for these accordingly. Key costs to consider are:
Buying in the secondary market:
|Land department transfer fees||4% + AED 540 administrative fee|
|DLD mortgage registration fee||0.25% of the loan amount + AED 290|
|Bank mortgage fee||1% of the loan + VAT|
|Property registration fee||AED 2,000 + VAT if the selling price is less than AED 500,000. AED 4,000 + VAT if selling price is more than AED 500,000.|
|Agency fees||2% of the property value + 5% VAT|
|Property Valuation fee||Ranging from AED 2,500 to AED 3,500 +VAT (depending on unit)|
When buying off-plan, you need to register for Oqood contract fee which is 4% of the original net property price and paid directly to the Dubai Land Department.
For more information, get in touch with us at Provident