Buying Property

Buying Property

It sometimes seems that nothing is impossible when it comes to Dubai property. In a bid to attract overseas investments in Dubai, architects and construction companies have been allowed enormous freedom in creating their property developments. Some of the most audacious construction projects the world has seen have been undertaken in this region. Even if these headline-grabbing properties are not to everyone’s taste or budget, there are plenty of high-quality homes to choose from.

The vast majority of property buyers have previously been looking for new or off-plan  property in Dubai and the Middle East. Although there are traditional Dubai properties for sale,  foreign ownership is restricted to designated areas, which invariably are the new projects that have been taking shape over the past few years. However, as more schemes are completed, there will be an increasing number of modern resale properties in Dubai and the Middle East.

It is difficult to exaggerate the scale of construction and the sheer variety of Dubai property. Small apartments, luxurious penthouses, spacious villas overlooking perfectly manicured golf courses, waterfront properties on a vast marina, beachfront properties – the list goes on. There’s a dazzling array of property styles too, from designs based on tradition Arab architecture to Mediterranean-style villas and cutting-edge high-rise blocks, via everything in between.

The Dubai property you invest in will depend a great deal on your reason for buying. Pure investors in Dubai should consider how the location and facilities offered by a property will appeal to potential tenants with an objective mind. Property buyers looking for a holiday property in Dubai will make a much more personal choice about the type of property they invest in. Whatever your requirements, Dubai offers an abundance of property styles that few other regions can match.

Buying Property in Dubai - The Market

Dubai was the first Middle Eastern country to embrace the idea of property investment from overseas property buyers and it boasts the most mature property market in the region. It has seen some very dramatic price rises over the past five years. Property rental returns have  been good and with demand exceeding supply, rents have increased quite dramatically in recent years. However, in more recent times rents have settled somewhat with the current economic downturn.

As more projects are completed in the region, the property markets will no doubt adjust. Anyone looking to buy property now will be impressed with the figures over the last few years but should bear in mind that speculation and limited supply of finished homes have been major contributory factors in the region’s property price boom. With around 150,000 villas and apartments due to be built in Dubai alone over the next three years, investors should carefully consider the likelihood that the “boom” years might be coming to an end. As the resale market expands there will also be downward pressure on prices.

Since the start of 2009 the global economic slow down has started to impact. However there are still ambitious plans for Dubai and the Middle Eastern states to increase commerce and tourism despite the current economic climate. There is still likely to be a sustained demand for quality property across the board.

The buyer beware note is - before proceeding with any acquisition, ensure that your finances are firmly in place.

HSBC offers a range of home loans and mortgages to support those purchasing a property.www.hsbc.homeae/1/2/


The Process of Buying Property in Dubai

  • Buying Dubai property is now much easier than it once was, thanks to the law allowing foreigners to own freehold title. To buy a new-build off-plan, the process is easy. The property buyer reserves a unit and pays an initial deposit  usually 10% .
  • The remaining balance is paid in stages until the completion date. This varies from developer to developer and should be agreed at the outset of the deal.
  • For resale property, a holding deposit is paid at the outset and completed once funds are in place to carry out the exchange .
  • Bear in mind that although Dubai is tax-free, you may find that you are required to pay taxes in your home country. This may apply to rental income or capital gains on disposal.. Get  professional tax advice on this matter to avoid any unexpected bills at a later stage.

Buying Property in Dubai - Fees and Taxes 

  • For new-builds, expect land registration fees of around 2%, and a year’s upfront maintenance charges, which vary depending on the development .
  • If buying a resale property, all the charges of a new-build apply, plus a 1% to 2% transfer fee, depending on whether the property is completed or not. 
  • Allow between 2% and 5% for agents’ fees.
  • While a lawyer is not legally required when buying property in Dubai, it is nevertheless highly recommended that you get independent legal advice, to review the contract.


 

Real Estate Agents