If you are a buyer looking to invest in the Dubai real estate market, then these three things should be in your to-do list -
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Checking the seller’s credibility
To avoid any unfortunate circumstances, always check whether your seller is verified to even sell the property in question. Make sure you do the following -
If the seller is a developer selling off-plan property, check that they have a title deed, valid trade license, and all the required permissions from the Dubai Land Department in order to build the property in the first place.
If the seller is an individual selling a ready property, check that they have the original title deed and identification documents (passport copy etc)
But if the seller is an individual selling an off-plan property, check that they have obtained a statement of account and NOC from the developer, confirming that the individual has cleared all his payments due to the developer and is free to sell the property.
Recent changes in govt regulations have further opened up the Dubai property market to overseas buyers and made investing in real estate an even more attractive prospect. In lieu of the same initiative, the UAE Central Bank has recently issued new regulations on the Loan-to-value (LTV) ratio to encourage real estate trade.
For a property purchase price under AED 5million the maximum loan-to-value (LTV) for an expat is 80% and for a UAE national is 85%
For properties over AED 5million, this decreases to 70% LTV for expats and to 75% for UAE nationals.
This, however, is kept at the same at 50% for both expats and UAE nationals when buying an off-plan property with no set purchase value
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Purchase Price
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Maximum loan-to-value ratio (LTV) for UAE Nationals
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Maximum loan-to-value ratio (LTV) for Expats
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| Under AED 5 million |
85% |
80% |
| Over AED 5 million |
75% |
70% |
| Off-plan/ under construction Property (no set value) |
50% |
50% |
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Review the Sale and Purchase Agreement carefully
Go over the document patiently and carefully, assessing all major and minor details.
When you are buying an off-plan property, review the unit size, plot size, the anticipated property completion date, and handover date, as well as the stipulated payment plan in line with the construction progress.
When you are buying a ready property, make sure that you effect the transfer of the sale within the stipulated deadline of the sale and purchase agreement, in order to not lose out on your booking deposit.
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Secure all original documents
Keep original copies of your sale and purchase agreement and the receipts of payment. This will be required in case there is a dispute with the developer, as a proof of purchase.