Innovative property investments
Investment property in Dubai
Buying Guide
Buying Considerations
For resale purchasers
Having selected an area or a development - or even a specific building - a potential buyer can approach a developer direct or an agent (many developers do not sell directly but some do and it is simply a case of asking).
If the property is resale, the ongoing lack of a formal conveyancing system means that the buyer's lawyer should ensure that the original developer transfers the title from vendor to buyer to ensure against fraud.
A developer will frequently ask for a fee for this service which can reach 2% of purchase costs.
For off-plan purchasers
If the property is off-plan - far more common - the buyer will select a unit and pay a holding deposit (refundable) of up to 3,500 GBP.
Contracts are then drawn up and a payment schedule agreed - this varies from development to development but generally more stage payments are required than in established Western markets.
For pre-completion resellers
Buyers looking to 'flip' or 'turn' properties during construction need to check their contracts very carefully; many developers require a percentage of any pre-completion resale profits, and some contracts limit the number of times a property can be sold before completion, thus narrowing the field of potential buyers.
Getting your property delivered on time
Dubai is earning a slightly unwelcome renown for the duration of construction of some projects.
While this may in fact be a conscious policy to ensure a good supply-demand balance it is rather unsettling for those looking to move into their properties, and extremely disturbing for those relying on rental income.
There is little one can do to avert this occurrence but a thorough reading of the contract and a request for a compensation clause in the event of excessive delays will go as far as anything to set buyers' minds at rest.
Benefiting from a tax free process
Obviously a big draw to Dubai is its tax-free nature and this holds true for its property market.
There are no transfer taxes or capital gains to be paid when buying or selling a home in the emirate; charges are limited to lawyer's fees, if any, and ongoing maintenance charges for those living in communal accommodation.
Key facts
- Resales: ensure that the original developer transfers the title from vendor to yourself; they may charge up to 2% of purchase costs for this
- Off-plan: a typical, refundable holding deposit will be up to 3,500 GBP
- Pre-completion reselling: developers frequently include contractual clauses requiring a percentage of any pre-completion resale profits and limiting the number of times a property can be sold prior to completion
- New builds: in the contract, request a compensation clause be included in the event of excessive delays to delivery of the property
- No transfer or capital gains taxes to account for when buying or selling in Dubai
- Additional costs are lawyer's fees and, for managed properties, maintenance
Downloadable Reports and Documents
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