Buying a property that is being resold in the Emirates is very similar to the process in the UK.You find a property and place a formal offer, normally through the agent. If the offer is accepted then a deposit of between 5% – 15% must be paid. You will also be expected to pay a transfer fee of between 1% – 7% and estate agent fees of between 2% – 3%.
Buying property off-plan is very common in the UAE; however there have been numerous cases were British nationals have lost their investments due to properties not being completed on time. If you are considering buying off-plan you should consult a registered developer and discuss your requirements. Dubai has a list of registered developers on the Real Estate Regulatory Agency (RERA) website.
Checklist
When you have found a property and checked that the developer is approved through a regulatory agency:
- Abu Dhabi – check with the Department of Municipal Affairs
- Dubai – Real Estate Regulatory Agency
- Sharjah – Department of Real Estate Registration
- Ajman – Ajman Real Estate Regulatory Agency (ARERA)
- Ras Al Khaimah – Real Estate Regulatory Authority (RAKIA-RERA)
- Fujairah – Check with the Fujairah Municipality
- Umm al Qaiwan – Check with Government of Um Al Qaiwan (Arabic site only)
Make sure:
- you have checked out other properties that the developer has completed to confirm the finishes and workmanship
- you are fully aware of how much you will be expected to pay and when
- you have confirmed that as a foreign investor you can purchase property in the area of your choice
- you, or your lawyer have read the finite details of the contract to ensure you understand the timescales involved and what responsibilities the developer has if the project is not completed.
Developers’ charges differ from emirate to emirate however you should expect to pay increments of 10% – 20% every three months until the project is completed. You will also be expected to pay a premium which is normally a percentage of the original price and a transfer fee. Agent’s fees are usually between 2% – 3%. You should confirm this before entering into a contract and check for any hidden costs.
There are designated areas in Abu Dhabi where foreign nationals can buy property as ‘freehold- leasehold’. This means a foreign national can only lease the land but has freehold rights on anything above the land.