The world is currently looking at Dubai’s real estate market, wondering which investment will be the most fruitful. While some foreign investors are looking at buy to let properties in the wake of the upcoming Dubai Expo of 2020, some expats are considering investing in real estate to settle down in the UAE. If you’re an investor who is thinking about investing in the real estate market in Dubai, especially with the upcoming influx of around 50,000 residential units, here are some important do’s and don’ts that you need to keep in mind as a foreign investor.
Do hire a real estate agent
Buying a property overseas is never an easy ordeal. Even if you have lived in the country, you will never be a specialist when it comes to the property laws and taxation policy of that country. Hence, it is recommended that you seek the services of real estate brokers in Dubai if you’re thinking about investing in Dubai’s real estate market. After all, who knows the property prices, land regulations, housing taxes and documentation required better than a real estate agent?
Don’t forget to check all the paperwork
While you might trust your real estate agent to the tee, it is essential that you check all the paperwork yourself. Even a minor error in the paperwork could cost you a whole lot of money! You need to go through the buyer and seller agreement and make sure that everything is as per the terms and conditions you agreed upon, check everything mentioned in the Memorandum of Understanding, make sure the No Objection Certificate is signed by the seller and only then submit the documents.
Do your research
There are so many properties available for sale in Dubai, and so many projects are still in the pipeline. Do your research about which type of property you want to buy – this could be a freehold property, a usufruct property or a commonhold property. Do you want to buy a luxury villa or a residential apartment? Which location do you want to invest in? You need to do your research before you can start looking at potential properties.
Don’t fall in love with the first property you see
Dubai is known for its luxurious properties – spacious villas with private pools uber-luxe apartments with views of the city, centrally located houses with all the modern facilities. So, don’t fall in love with the first property that you visit! Check out all the potential options, see which property fits into your budget, find out the cost of houses or apartments in the neighbourhood, make sure the property meets your requirements, and then finalize on the property that is right for you.
Do explore all your financing options
The way you’re researching the perfect property, you must explore all your financing options and find the best one. Speak to various banks about a mortgage and find the best rate of interest. Before doing so, make sure that your credit score is good and that you have a sufficient amount of money that you can put as the downpayment. Keep in mind that the downpayment can vary from 25 per cent to 50 per cent for expats, so find a financing option that is right for you and fit within your budget.
Don’t forget about the associated costs
The cost of buying a home in Dubai isn’t limited to the initial downpayment and the interest on mortgage. You also need to keep associated costs in mind. This includes the cost of the real estate broker, registration fees and transfer fees, registration trustee fee, mortgage registration fee, the cost of the No Objection Certificate which goes to the developer and let’s not forget about the knowledge fee that has to be paid to The Dubai Land Department. Then, comes the cost of moving, the initial cost of cleaning, the cost of setting up as well as the monthly utility bills. The associated costs can amount to quite a bit, so make sure you’re well prepared financially.