How to Buy a Property in Dubai

1Figure out what you can afford.

Remember for buyers there is a 2% agency fee and a 4% transfer fee to take in to account when it comes to any purchase. Are you planning to mortgage? Then you will most likely need at least 25% of the property as a down payment. You will also be paying interest on your loan which varies, but is around 3-4% depending on length of loan and bank. Make your calculations to set a budget – your agent can help you with this step.

2As a Finance Buyer, are you pre-approved?

Being pre-approved not only confirms your budget but it also puts you in a stronger buying position. First, a bank reviews your application, before issuing a letter or an email stating the approved loan amount, which is generally valid for 60 days.

3Find a Real Estate agent and company that you trust.

Find an experienced agent to work with you to understand your full budget, wants and requirements. When working with industry experts, the more detail you go into at a preliminary stage, the less time it takes to find the right property. It is very important at this stage to give your agent the best understanding of what you are looking for.

4Start viewing properties!

As a property consultant, your agent will highlight communities and properties that match your budget and requirements. Arrange appointments to view several options until you find what you are looking for.

5Make an offer.

For the strongest chance of acceptance, we recommend putting your offer in writing, with a copy of a 10% deposit cheque, along with copies of the passport and Emirates ID of all parties who will be on the title deed.

6Once the offer is agreed sign MOU.

Your agent will draft an MOU which stands for Memorandum of Understanding and is also known as a Form F. You will review the MOU and then both parties will sign the contracts along with handing over the 10% deposit cheque.

7The sales progression process.

If the buyer is purchasing with a mortgage then the bank’s involvement will be needed. A bank valuation on the property is required and the buyer will need to obtain the final offer letter from the lender, which secures the chance of a mortgage. If the seller has a mortgage on the property, the buyer is required to settle the seller’s mortgage in full prior to the No Objection Certificate (NOC) application. If this is the case, make sure that once both parties have signed the MOU, the seller requests a mortgage settlement statement from his/her bank as this can take up to 2 weeks. (This process can vary depending on bank, but we would factor in an average of 6-10 weeks)

8Apply for the NOC.

All parties will meet at the offices of the developer to apply for an NOC to sell the property. The developer will usually issue the NOC against a payment of a fee (AED500-5,000 depending on the developer) once the developer is satisfied that any amount due to the developer in the form of service charges have been settled in full, along with ensuring that any modifications the seller may have made have been completed as per the developer’s guidelines. Usually someone from the developer’s office will come to view the property once the NOC is applied for. Certain developers will also require a refundable deposit made from the buyer, which is only refunded once the buyer presents the new title deed at the developer’s office and their records are updated. (The processing can take up to 5 working days)

9Transferring of ownership.

Once the NOC is issued, all parties are able to go to the office of the Dubai Land Department to officially transfer ownership. The DLD will insist on payment of the purchase price in the form of a manager’s cheque made payable to the seller on the date of transfer, along with manager’s cheques for the 4% transfer fee due to the DLD and an admin fee not in excess of AED 4,000. Once formalities are completed, a new title deed will be issued in the name of the buyer. At this time, the buyer will settle any overpaid service charges with the seller worked out pro rata.