The process of buying property in the UAE
The United Arab Emirates today is a country where investments from all over the world flock, and most often foreigners invest their money in local real estate, which is represented in the UAE in a wide variety. Consider the whole process of buying square meters in this country.
When making a choice in the UAE, it is important for yourself to decide on the purpose of buying real estate – for personal use or doing business. Based on this, it will be clear where exactly it has to choose. Dubai is the main center for the concentration of the commercial and residential real estate market in the UAE, but there are several more emirates that are opting for – Ras al-Khaimah, Sharjah, Ajman and Abu Dhabi. Moreover, the purchase procedure is approximately the same in all the UAE.
If a home purchase is supposed to be leased, then it is not necessary that these should be the most prestigious options: for example, Dubai has second-tier areas where rental income will be higher than from objects located on the first line, and investments and maintenance this will be much less. Of course, it is best to address your requests to specialists who know the market from the inside, who understand all the details of legislation and local mentality, have many years of experience in the UAE real estate industry.
Today, all information about such companies, including reviews, can be easily found on the Internet, including personal profiles on the social networks of those people with whom they plan to cooperate. If this is an LLC, then you need to check more carefully, request documents about the decision of the board of directors, etc. Well, if a particular company can recommend people familiar to the buyer who have already purchased property in the UAE with its participation. With an unsuccessful choice of a company, it sometimes happens that people acquire illiquid objects from dubious intermediaries and companies, overpaying for this one and a half to two times. A good broker will select a reliable developer and will be able to get a good discount not only in the secondary, but also in the primary market.
Freehold and leasehold
The main thing that a buyer of real estate in the UAE needs to know is what type of ownership of the property is supposed to be – leasehold (long-term lease) or freehold (full ownership for 999 years). Almost all Freehold is concentrated in Dubai, it is in Ajman, and in other emirates such zones are almost absent. Therefore, it is important to carefully read the documentation of the object and its characteristics regarding ownership.
If there is enough time and money before making a purchase, then experts recommend coming to the UAE several times, staying in different areas in order to better understand and feel personal preferences for the subsequent right choice. It is not recommended to purchase real estate if there is an intention to live in it for less than two to three months a year – after all, this is a kind of burden that requires attention and maintenance costs. In this scenario, it is easier to rent a property for the period of residence, without worrying about anything. And real estate for permanent residence and business or contract work must be selected based on their own income and preferences.
When buying real estate in the UAE, it’s worth “mortgaging” 11-12% of the purchase amount of an object, taking into account all fees and taxes, with the exception of “special orders” – the selection of very profitable objects when a specialist can ask for an additional fee.
All the necessary documents are prepared by the selected company or client’s lawyers who know the local laws, you can also provide a list of requirements for drawing up a contract to the selected real estate agency – this applies to both sale and purchase transactions of private individuals and private companies. For registration of real estate in the project under construction, you only need a passport, all other documents in English will help to sign a real estate company.
To purchase finished or secondary housing, you need to open a personal account in a bank in the UAE, which causes great difficulties. Not all banks provide such a service for non-residents of the country. In this situation, a lot depends on the broker – he will either select a bank that will open the necessary account or make a payment through a state-owned company specializing in such transactions. However, in the second case, you will have to pay a substantial commission.
By purchasing real estate in the secondary housing market, the buyer makes a deposit of 5-10% of the total cost (sometimes a reservation is made in the amount of AED 10,000 – 30,000, and the down payment is paid upon signing the contract of sale), which is usually carried out in the form of a check in the name of the seller, which is stored with the broker company until the transfer. It is strongly not recommended to transfer money to the account of a brokerage company, as well as to the account of the owner of the real estate from which it is purchased.