The Middle East and specifically Dubai has become a favourite destination for foreigners to buy property. Today, Dubai is experiencing high rental costs and healthy real estate market that is continuously growing. Buying property in Dubai has turned into a feasible and smart option for expatriates residing in Dubai. The buying process can be straightforward especially when the seller does not have a loan on the property. But buyers are advised to take caution and understand the buying process to minimise risks that may arise from such a major transaction.
Take Time to Understand the Purchase Property Dubai Process
Property in Dubai can be purchased in two ways: an off-plan from a developer or a resale from a private seller. In an off-plan purchase process, the buyer must submit the passport and a reservation form that contains the terms and conditions of the deal. To commit both parties to the transaction, a reservation fee that ranges between five to ten percent must be paid to draft the sales and purchase agreement (SPA). If the selected property is still under construction, the buyer should ensure that the contract contains the completion date and a compensation clause in case there is a hold-up in completion.
When buying the property from a private person, there should be a Memorandum of Understanding that ties both sides to the terms and conditions of the agreement. As a buyer, you must put down a ten percent deposit of the property price as a purchase confirmation as you await approved financing. Once you get the approval, you are free to transfer the deeds.
Properly Arrange Your Finances
If you want to finance your property with the help of a bank, check your mortgage eligibility. Carry out research to establish the best mortgage brokers and ensure that you will commit to the purchase before you sign any contracts and issuing the deposit.
Why are you purchasing the property?
Whether you are acquiring the property as a business venture or you are buying that property to occupy yourself, it can have a significant impact on the type of property and location. If you are buying that property as an investment i.e. to rent out, it is important to study the property market and the properties that have high potential yields.
Decide on the Location to Purchase Property Dubai
Dubai has many enticing projects: therefore, you need to choose the right area for you. You can hire a professional, like HBS Real Estate, to advice you on the best property that meets your needs.
Carry out due diligence
When buying an off-plan or resale property, it is vital to ask lots of questions to know the reputation of the real estate developer or the private seller. If you are purchasing the property from a developer, visit their show homes to find out what they can offer. If you are planning to buy from a real estate agent, find an agent who is listed with the Dubai Land Department.
Apply for the No Objection Certificate (NOC)
Once you are ready, your broker should help you obtain the NOC from the developer’s office. This certificate ensures that the property is fully paid for, all maintenance fees are cleared, and there is no mortgage.
