If you have been considering buying a houses in Dubai the UAE, then you know that this country and the emirate specifically are welcoming to the foreigners. Expats wishing to invest in property in Dubai may encounter some features that are not common to the real estate market of their homeland. So, read our article and be prepared.
Purchase of unfinished real estate
There are some differences from buying a ready-made property and a property directly from the developer, which may still be under construction. First you need to meet with the developer and make sure that the final version of housing or office will meet all your requirements. Many developers listen to the opinions of buyers and make the necessary changes to the layout or finish. If everything suits you, then you must fill out the order form and pay a deposit in the amount of 5-20% of the total cost of the real estate. Then a full-fledged contract is drawn up, which, however, distinguishes it from the usual contract of sale, more reminiscent of a booking contract.
Obtaining a loan for the purchase of real estate in Dubai
The crisis of 2008-2012 hit the banks that had previously easily distributed loans to foreigners, including for real estate. Now, applying for a mortgage is not so easy. And the government of Dubai, fearing another crisis, makes sure that banks check those who are granted loans. And yet, you can get a mortgage from a financial institution if you have a resident visa, have at least a third of the required amount (better – 50%), you are able to present a certificate of stable monthly income and can provide something valuable as collateral (apartment or villa not purchased on credit).
Of course, banks do not lend to expats for free. The monthly interest rate for most financial institutions fluctuates around 4%. The most popular term for which a mortgage is taken is 15 years, but a maximum loan of 25 years is also possible. You must pay the body of the loan and interest on it every month. The bank will not give you a loan if you spend more than 35% of your income every month on mortgage repayment. To obtain a mortgage, you will need to present the following documents to the bank:
- the passport;
- residence visa;
- an extract from another bank for 6 months;
- confirmation of solvency;
- documentary evidence of the absence of objections from your employer and others.
Taxation and other expenses related to real estate transactions
You will have to pay 5% of the transaction amount to the realtor for finding you a suitable option. The services of a lawyer who certified the transaction and prepared the contract are not free either. In addition, you must pay the Land Department an amount of 1-7% of the cost of housing or office (usually, this amount ranges from 2-3%). And of course, it is worth preparing for the fact that you will have to shell out a lot of money for maintaining the purchased property in order: for cleaning the common territory, for garbage removal, for lawn, pool and garden care, etc.
Transfer of real estate by inheritance
Some foreigners are hesitant to purchase housing or commercial premises in the UAE, because they fear that they will not be able to pass it on to their children due to the exotic nature of local law. However, the Dubai government solved this problem many years ago. In 2006, changes were made to Law No. 7. Thanks to these changes, foreigners have the right to either lease immovable real estate for a period of 99 years or become their full owners if the purchase is made in the designated territories. You need to register your purchase with the Dubai Land & Property Department. The owner of real estate can transfer it after his death to the heir, if he correctly draws up a will, assuring him in court. In respect of non-Muslims, the procedure of inheritance takes place according to the laws of the country of which the deceased was a citizen. Lawyers reassure expats that if you get your will right and your heirs pay all the necessary fees, then the inheritance process will go smoothly.
Real estate agency in Dubai
Ax Capital real estate agency will help you reduce the amount of stress that you may encounter while purchasing property. As their specialists know all the intricacies of the market, that can assist you in making your purchase. All you have to do is go over to their website and start your search. The specialists of the agency will provide a full support to you making the process of acquiring real estate in Dubai the most pleasant experience.