When it comes to the idea of buying a property in Dubai, the excitement gets manifold. And that is not without reason.
Dubai has a lot to offer to its residents: beautiful skyscrapers, modern shopping malls, low crime rates, excellent transportation infrastructure, and high investment returns.
The city also offers a luxurious and enjoyable lifestyle with a plethora of career and entertainment options. As such, investing in a property in Dubai can be one of the best decisions in your life.
The city has drawn many people from all over the world during the last few years. Many people prefer making the city their home for a fantastic lifestyle and the considerable advantages of living in Dubai, such as tax-free income and no property tax.
With the influx of people, demand for properties escalated significantly, and the real estate market in the city has become a thriving investment hub.
Akin to any industry, the real estate industry in the UAE also undergoes occasional ups and downs. So, you should assess whether it is worth investing in a property in the city by weighing the pros and cons associated with the investment.
Advantages of buying a property in Dubai
Even if you are a bit confused, it remains the fact that there are multiple benefits of buying a property in Dubai, such as:
Ask yourself a pertinent question—do you want to buy a property at a place where development has stagnated or where growth is happening with the launch of new creative properties?
The answer is obvious. A developing place is an obvious choice.
You might be aware of the fact that Dubai is on its way to becoming the world’s smartest city. You will find many new aspects of the city, and that will add to your enjoyment.
Dubai is the home of the world’s tallest structure, Burj Khalifa, and the good news is that there will be another tower in the city that will be taller than the Burj Khalifa.
The eye-catching innovations can be among the reasons for you to purchase a property in the city.
New shopping malls will come up near the property you purchase, and new roads will connect your community to increase your property’s value over time.
Interestingly, you are eligible for an investor visa in Dubai if you purchase a property worth at least AED 1 million in the city. But, you will have to guarantee that the property you are buying is not under a mortgage or off-plan.
Likewise, you are eligible for a five-year renewable visa if you purchase an AED 5 million worth of property in the city. And the purchase of AED 10 million worth of property will enable you to become eligible for a 10-year renewable residence visa.
You will hear almost nothing about crime in Dubai. The sense of security you will get in Dubai is among the many benefits of buying a property in Dubai. And it is also one of the reasons for people moving to Dubai.
Dubai poses a safe property investment destination where children can play freely, and people can sleep freely without worrying about thefts.
The city’s security system is very tight and sophisticated with the implementation of the latest gadgets that can tackle any criminal.
With a strict law and order system, the city administration maintains a safe environment. Dubai has strict and stern policies against crime. Robbery incidents are close to none, and you can walk peacefully alone, even at night, without worrying about robberies.
Good Rental Yields
High returns on investment are one of the key benefits of buying a property in Dubai. If you buy a property in the city for renting out, you can make profits.
Villas can get you rental yield returns of over 4 percent. Also, properties in the city’s popular areas can get you rental yields of more than 9 percent.
High rental yields are among the benefits of purchasing a property in the city. If you are buying a property in the city for renting out, ensure that you acquaint yourself with Dubai’s tenant rights. And it is also an excellent time to buy a property in the city for renting out as the Dubai rental market 2021 is expected to flourish significantly.
No Property Tax
It might sound untrue, but it is true. And it is one of the reasons why people want to purchase properties in the city.
After you purchase a property and pay the necessary fees to the Dubai Land Department(DLD), there are no other government taxes to pay regularly.
Disadvantages of Purchasing a Property in Dubai
Despite the many perks of owning a property in the city, there are disadvantages which you should consider beforehand.
Property purchases in Dubai entail the following disadvantages:
The costs that come in addition to the property’s price are the factors to consider as they will entail significant money outgo.
If you purchase a property from a developer, you have to pay a fee, amounting to 4 percent of the property value, to the DLD for issuing the Title Deed and the administration fee.
If you purchase a property on a mortgage, you will have to pay 0.25 percent of the mortgage value as the mortgage registration fee to the DLD in addition to the administration fee.
Becoming a UAE Citizen is Not Possible
Bear in mind that there is no possibility for you to become a citizen of the UAE by purchasing a property and staying in it.
You will only get a long-term residence permit, and if you fail to renew your permit, you will have to leave the country.
The Process of Property Purchase in Dubai
One thing to know before buying a property in Dubai is the nitty-gritty involved in the buying process.
Get all the necessary documents: your passport, Emirates ID, residence visa, photographs.
If you require a mortgage, get a pre-approval for a loan from the bank. The pre-approval requires a fee and remains valid for 45-60 days, depending on the bank.
The bank will ask for your passport, visa, Emirates ID, six-month bank statement, six-month credit card statement, and payslips for pre-approval.
The pre-approval will have the general terms and conditions of the mortgage. The final terms will appear after you purchase the property.
After you finalize a property to purchase, you need to sign a memorandum of understanding (MoU) with the seller. There is a standard format for the MoU, and you can download that from the DLD website.
You can register the MoU with a DLD authorized registration trustee office. The buyer, seller, and agent have to be present at the office during the MoU registration.
The MoU does not represent the actual purchase but the finalization of the property purchase. The trustee will charge a security cheque amounting to 10 percent of the sale price. However, the trustee will return you the cheque after the conclusion of the property purchase.
After that, the trustee will send the details to the DLD for clearance. Usually, the DLD gives the clearance within one to two hours. There is also a fee associated with the procedure.
The next two steps involve getting the bank’s final approval if you are taking a loan and a no-objection certificate (NOC) from the developer, certifying clearance of all dues.
The final step involves booking the property. You can pay the money by cheque or bank transfer at the registration trustee’s office. You also have to pay the fees for the issuance of the title deed.
So, these are the things to know regarding how to buy a house in Dubai. In this context, you should note that you also have to write a will that will dictate who will own the property if any unfortunate occurrence happens to you.
Types of Property Ownership
In Dubai, there are two types of property ownerships—leasehold and freehold.
A leasehold allows you to own the property for a fixed term, usually 99 years. Remarkably, the ownership grants you the right to hold the property and not the land on which the property stands.
With freehold ownership, you get the right to own the property and the land on which it stands.
Among the benefits of buying freehold property in Dubai, you can sell, rent out or stay in the property at your will.
The Final Thoughts
Despite minimal disadvantages, there is a slew of benefits in owning a property in the city. With ample availability of Dubai investment properties and a reliable property search website like TopLatest, you can spot your dream property quickly. If you are thinking about purchasing a property in Dubai, go for it.