The Property Buying Process

Many of our clients are familiar with purchasing property in their own home market however, the process of finding and securing a Dubai property can be quite different. The following paragraphs will give you an insight into the local market but you should seek guidance from one of our property experts who will guide you through every step.

Finding a Suitable Property

With so many developments available on the market the biggest challenge to face most of our clients is finding the most suitable to their needs. To do this our staff will take time to understand your requirements and advise you accordingly. Property deals tend to get closed quite quickly, with this in mind it is highly advisable to arrange your finances prior to commencing your search, this often helps to avoid disappointment.

Construction Period and Developers

Most developments are due for completion at least 18 months after launch. All developers and sub developers are required by law to use a system of Escrow accounts that ensures any moneys received for off-plan unit sales are allocated back to the developer as a project proceeds based on official certification of the stage reached. This system was put in place to guarantee funds are used for the correct purpose and has resulted in increased transparency and confidence in the Dubai property market.

Payment Schedules

Units are paid for by a series of payments spread over the construction period. Payment schedules tend to be quite evenly spread requiring the majority of the purchase price to be paid before completion. All developments vary but typically the purchaser would be required to put down 10/ 15% booking deposit followed by 10/ 15% every 3 months or even up to 20% installments in some cases.

Premium

A property is sold by the developer at the 'Original Price' to the purchaser. The capital appreciation on the property is referred to as the 'Premium.' When a purchaser buys from another individual it is referred to as a 'Secondary Sale.'

Valuations

If you are raising finances for your Dubai property from one of the locally based Banks you will often be required to obtain a valuation if you are buying a 'secondary sale. This is normally quite a straightforward homebuyers valuation and is aimed at confirming the market price and any premium on the property.

Re-Sale Terms

The terms and conditions applied for re-sale have in the past differed from developer to developer. The formation of the Real Estate Regulatory Authority (RERA) has come about with the objective of standardizing re-sale processes. RERA has begun to regulate these procedures, but it should be noted that the market is still in a period of transition and that there remains a way to go before all developers adopt standard industry practices. Resale guidelines as they stand at the moment are as follows:

  1. Properties need to be pre registered with the Lands Department by the owner before a re-sale can take place
  2. The Lands Department will take over all property transfers
  3. Owners will need to pay a transfer fee and a registration fee to the Lands Department not the developer
  4. Property transfers will be recorded with a government entity (Lands Department) and not the developer
  5. Vendors will need to obtain a letter of no objection from their property developer

Understanding Dubai re-sale processes will not be easily accomplished if you are not familiar with the market. The Dubai Luxury Homes staff is well versed in RERA laws and will immediately be aware of any changes or developments that occur within the market, putting us in an ideal situation to offer advice and answer any questions that you may have.