Buying a property in the UAE

by ArabianBusiness.com staff writer Wednesday, 27 February 2008

Who can buy?
Anybody can purchase in Dubai's luxury freehold property market.

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Leasehold or freehold?
Freehold is available on many of the developments in Dubai. Some projects are 99 year leasehold.
Payment terms
In general, a deposit representing 10-15% of the buying price is required at the contract-signing stage for all new development properties. Each developer will offer a different payment plan.

Payment terms for completed property
Completed property needs to be paid in full (100%). The developer will charge a 1-2% transfer fee to put the property contract into your name and the contract will follow in about 2 weeks.

Bank accounts
Buyers do not need a local bank account to arrange purchases.

Purchase timescales
Purchases normally take no longer than two weeks to complete. It is important to have your funds ready in order to prevent disappointment.

Government tax
There are currently no government taxes of any kind when purchasing a property in Dubai nor is there Capital Gains Tax. When the Dubai Lands Department registers title, buyers will pay a 1.5% tax based on the purchase price of the property. If they have a mortgage, they will pay 0.25% of the value of the loan.

Residency
In general, the Dubai Government issues residence visas to new property-owners and their immediate family. These will need to be renewed every three years as per the latest immigration regulations.

Re-sale
You can sell your property or assign your agreement to anybody. This means that they will take over the payments to be made to the developer.

Holding deposits
All sellers insist on a holding deposit to secure the property. This is normally in the region of AED 100,000. It is non refundable unless the seller pulls out.



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