Dubai’s real estate market is one of the most exciting and profitable globally. With its tax-free benefits, excellent infrastructure, and steady growth, it has become a magnet for investors, homeowners, and businesses alike. However, it’s also a highly regulated market with its own unique set of rules and processes. To help you understand the market better, we’ve answered 20 of the most frequently asked questions about Dubai real estate.
Each answer delves into the specifics of the market, ensuring that you have the information you need to make confident decisions, whether you’re buying, selling, or renting.
Can Non-Residents Buy Property in Dubai?
Yes, Dubai allows non-residents to purchase property in designated freehold areas. Freehold ownership gives non-residents full ownership of both the property and the land indefinitely. Some popular freehold zones include:
- Downtown Dubai: Known for iconic landmarks like the Burj Khalifa.
- Dubai Marina: A sought-after waterfront community.
- Palm Jumeirah: One of the most prestigious areas for luxury villas and apartments.
- Jumeirah Village Circle (JVC): An affordable community with high rental yields.
Non-residents don’t need to hold a UAE visa or residency permit to purchase property. This policy has made Dubai an attractive destination for global investors.
What Is the Difference Between Freehold and Leasehold Properties?
- Freehold Properties: These allow the buyer to own the property outright, including the land it is built on, forever. Freehold properties are available in designated zones such as Business Bay, JBR (Jumeirah Beach Residence), and The Greens.
- Leasehold Properties: Buyers can lease these properties for a term of 10 to 99 years. The ownership of the land remains with the landlord. Leasehold areas are mostly located outside the freehold zones.
For expatriates and investors looking for long-term ownership, freehold properties are generally recommended.
What Are the Costs Involved in Buying Property in Dubai?
Apart from the property’s purchase price, there are several fees to consider:
- Dubai Land Department (DLD) Fee: 4% of the property value, paid at the time of transfer.
- Real Estate Agent Commission: Typically 2% of the property value.
- Property Registration Fee: AED 2,000 to AED 4,000, depending on the value of the property.
- Mortgage Registration Fee: 0.25% of the total loan amount if you’re financing through a mortgage.
Example: For a property priced at AED 1,000,000, you may incur fees exceeding AED 60,000.
Are There Financing Options Available for Non-Residents?
Yes, many banks and financial institutions in Dubai offer mortgage options for non-residents. Key points include:
- Loan-to-Value (LTV): For non-residents, the maximum LTV is usually 50% for the first property.
- Interest Rates: Vary between 3.5% and 5%, depending on the lender and loan term.
- Repayment Term: Can go up to 25 years, depending on the age of the borrower.
What Documents Are Required to Buy Property in Dubai?
To purchase property in Dubai, buyers need to submit the following documents:
- Passport Copy: For identification purposes.
- Proof of Address: Recent utility bills or tenancy contracts.
- Proof of Funds: Bank statements to demonstrate financial capability.
- Memorandum of Understanding (MoU): Signed agreement between buyer and seller.
What Is an Ejari Certificate?
The Ejari certificate is a mandatory registration of all tenancy contracts with the Dubai Land Department. It:
- Protects the rights of both landlords and tenants.
- Helps resolve disputes if they arise.
- Is required to set up utilities, apply for visas, or sponsor dependents.
Landlords or tenants can register the Ejari online or through an approved typing center.
What Are the Benefits of Investing in Off-Plan Properties?
Off-plan properties, or properties under construction, often come with several advantages:
- Lower Prices: Often 20–30% cheaper than completed units.
- Flexible Payment Plans: Many developers offer post-handover payment plans, easing the financial burden.
- High ROI: Properties in emerging areas like Dubai South and Mohammed Bin Rashid City (MBR) offer excellent growth potential.
Risks to Consider:
- Delays in project completion.
- Developer’s credibility.
Research the developer’s track record before investing.
How Can Dubai’s Real Estate Help Secure Residency?
Investing AED 750,000 or more in Dubai property allows you to apply for a residency visa. Key details include:
- Investment Visa Duration: Typically 3 years, renewable.
- Dependents: You can sponsor family members.
- Eligibility: The property must be fully paid and free of mortgages.
What Are Service Charges, and Who Pays Them?
Service charges are annual fees that property owners pay for maintaining shared areas like:
- Swimming pools, gyms, and landscaping.
- Elevators and security systems.
Charges vary based on the property and location. For instance, Dubai Marina service charges range from AED 20–30 per sq. ft.
Are Properties in Dubai Tax-Free?
Yes, Dubai offers tax-free property ownership, meaning there are:
- No capital gains taxes.
- No property taxes.
- No inheritance taxes.
However, transaction-related fees (like DLD fees) still apply.
Can Properties Be Sold Before Handover?
Yes, properties under construction can be sold in the secondary market through a process called assignment of property. This allows investors to transfer ownership before the final handover. Developers usually charge an assignment fee for this process.
What Is the Role of the Dubai Land Department (DLD)?
The DLD is the primary authority regulating all real estate transactions in Dubai. It:
- Ensures transparency and legal compliance.
- Oversees property registrations and ownership transfers.
- Manages dispute resolution.
What Are Common Mistakes First-Time Buyers Make?
- Failing to research the developer’s history.
- Ignoring additional fees like service charges or agent commissions.
- Skipping legal due diligence.
