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FAQ

Most frequent questions and answers

The UAE’s real estate sector contributes around 5.5% of the GDP of the country, and it has been on the rise since 2022 as both rental rates and home prices have increased. Dubai’s transaction volume reached its highest level for the first quarter ever observed in the area in the first quarter of 2022.

Yes, foreigners are permitted to purchase real estate in the UAE. There are, however, certain geographical limitations. Citizens of the UAE or the Gulf Cooperation Council (GCC) may buy real estate anywhere in Dubai.

In Dubai, there are specific zones where foreigners can purchase real estate. These locations, such as the Palm Jumeirah, Downtown Dubai, Dubai Marina, Arabian Ranches, and Jumeirah Beach Residence, are decided upon by the Ruler of the Emirate of Dubai.

Real estate purchases in Dubai may result in the buyer receiving a residence permit. The property must be finished at the time of purchase and worth at least AED 1 million to qualify for the UAE investor visa program. Dependents may also be sponsored by real estate purchase residence visa holders.

The real estate industry in the UAE is anticipated to increase by 2.97% between 2023 and 2028, reaching a market volume of US$0.80 trillion by that year. The important characteristic that makes the UAE a desirable location for real estate investment is what is driving this expansion.

Here are some tips to invest in UAE real estate:

  • Know About Different Property Types and Their Worth
  • Research the Market Status and Risks
  • Property Investment in Dubai
  • Don’t Sacrifice Location
  • Choose Areas with High Rents and Demand
  • Spend Time in the Area
  • Luxury Property Buyers Should Have Financial Resources
  • Investing in Residential Properties Offers Shortcuts for Legal Residency
  • Seek Expert Advice When Investing in Dubai Real Estate

In Dubai, investors can choose between villas, apartments, townhouses, penthouses, duplexes, and plots and lands.

Upon selling real estate, the following fees are paid:

  • No Objection Certificate (NOC) fees ranges from AED 500 – 5,000 depending on the developer and property type.
  • Agency fees 2% + VAT of the sale price of the property
  • DLD fees 4% of the sale price of the property
  • Transfer of ownership fees AED 2,100 for properties sold for less than AED 500,000 and AED 4,200 for properties sold for over AED 500,000.

The Property Investor Residence Visa requires an investment of either AED 750,000 or AED 1 million in registered property, while the Golden Visa needs property ownership with a minimum equity value of AED 2 million.

The primary aspects to take into account are: accessibility, rental yields, length of stay, market trends, location, quality, and immigrant investment.

Ejari is useful for establishing the legitimacy of landlord-tenant relationships in Dubai.

The required documentation depends on the kind of property and the emirate. The following are the documentation that a buyer of a real estate normally needs:

  • Passport
  • Sale and purchase agreement, commonly known as the Memorandum of Understanding or Contract F;
  • Current resident visa or authorization to purchase reside in the UAE
  • The developer’s or prior owner’s No Objection Certificate in the case of a secondary market
  • If the investor hires a representative or agent, a power of attorney

Freehold: The property and the land it is constructed on are yours to keep for as long as you choose.

Leasehold – You don’t own the land on which the property is built, but you do for a specific duration of time.

The Ejari certificate ensures that communication between the landlord and the tenant is open and transparent, fully integrating rental agreements into the legal system, and enabling simple contract amendment in the case of a dispute.

Online Ejari registration costs AED 155 (VAT excluded). Every time your rental agreement has to be renewed; you must also renew Ejari online. The AED 155 renewal charge for Ejari online also includes VAT.

The Ejari fee must be paid by both the landlord and the renter; however, nowadays, the real estate agent or brokerage typically handles this on their behalf.

No, in order to verify rental ties, you must confirm the contract to Ejari in Dubai.

Yes, the DEWA website or DEWA Smart App will ask you to submit your Ejari number when you apply for DEWA Move-in.

One Ejari for one property. Before you try to register a new Ejari, be sure your landlord has canceled the existing one because there can only be one Ejari at a time on a property.

Oqood is a typical concentration of off-plan sales that the DLD and the RERA have implemented. Buyers and sellers may log on to this online service and complete real estate transactions in a transparent manner and in accordance with local laws. Prior to the issue of the title deed, Oqood can register property ownership.

The Oqood cost, also known as the Oqood registration fees, is equivalent to 4% of the purchase price of the property. It does not apply to the property’s selling price. In Dubai, a buyer is responsible for paying the property developer’s 4% Oqood charge.

When the purchaser has given the developer at least 25% of the total payment, an Oqood certificate is provided.

Yes, Oqood registration is a condition that must be fulfilled, and it costs 4% of the selling price in DLD fees.

Dubai Land Department, often known as DLD, is a government agency that was founded on January 24, 1960, to deal with all issues pertaining to the legalization of real estate deals in the Emirate of Dubai.

DLD provides more than 150 services in the UAE. All the services are divided into 9 major categories:

  • General
  • Jointly-Owned Property Services
  • Real Estate Development Services
  • Real Estate Dispute Services
  • Real Estate Licensing Services
  • Real Estate Rental Services
  • Real Estate Residential Services (Taskeen)
  • Real Estate Transaction Services
  • Title Deed Data Services

Trustee fees are the sums of money you’ll pay your designated trustee in exchange for the assistance they’ll render in carrying out their responsibilities under the position. A Trustee need not be an individual; if you like, you can name a bank or a reputable wealth management firm in that capacity.

E-Factors are strongly related to other secular, long-term real estate demand factors including demography, technology, and urbanization (DTU). E-Factors have to be taken into account carefully while analyzing portfolios and other financial assets.

In Dubai, a DLD waiver is the exclusion from payment of all or part of a fee or charge levied by the DLD in connection with a particular real estate transaction. The waiver intends to assist Dubai’s real estate market and encourage investment there.

Emaratech Software and Systems LLC and Dubai Government’s DLD have partnered to form Emirates Real Estate Solutions (ERES), as part of a government initiative to assist real estate industry participants in easily complying with and benefiting from the regulations developed by the government along with the RERA to create uniform standards for the sector. ERES also creates, markets, and offers goods and services to the real estate and property management sectors.

 

ERES provides cutting-edge and inventive IT solutions based on DLD best practices from the previous 50 years as well as RERA, which increase the real estate market’s efficiency and transparency.

Property owners, tenants, real estate brokers, developers, real estate appraisers, investors, and all other real estate market participants execute all real estate services through Dubai REST, the smart real estate platform for real estate services.

The Dubai government’s ambitious Dubai Virtual Commercial City (VCC) initiative aims to create a new centre for e-commerce, innovation, and trade. Dubai is intended to become the first worldwide metropolis for digital commercial trade. The VCC will be a free trade area with no import taxes, tariffs, or restrictions.

The majority of the administrative tasks involved in purchasing and selling real estate are handled by a transaction coordinator (TC). They frequently collaborate closely with real estate brokers to make sure your transaction goes through without a hitch.

Compared to transaction coordinators, transaction managers are licenced and have greater experience. As a result, they operate as an agent while conducting a real estate transaction. They take on greater responsibilities than transaction coordinators and handle the transaction.

BUA is referred to Built-Up Area. This is the overall area for development on the land as well as the gross floor space of a building.

The term “Net Floor Area” (NFA), also known as “Net-Usable Area” or “Occupied Area,” refers to the useable floor area.

A transaction coordinator goes by various titles, including facilitator, fairy godmother, and professional organizer.

GBA is simply a measurement of a building’s volume. measured between any enclosing walls, balustrades, and supports that are typically on the OUTSIDE. GFA (m2) Total floor area within the building envelope, excluding voids, open balconies, exterior walls, and the roof. Includes FECA and UCA. The total of FECA and UCA is calculated.

The unit of measurement used by Dubai’s planning authorities to describe the floor area ratio (FAR), which is the relationship between plot area and gross floor area (GFA). The GFA of the building is calculated by adding the GFAs of all levels, measured to the external wall’s outside surface. thickness and from the common’s centerlines.

The breakwaters’ original bottom level ranges from -13 to -15 meters above Dubai Municipality Datum (DMD).

Internal partition walls generally range in thickness from 100 to 200 mm, depending on the structural demands and loads at specific areas throughout the structure.

The Dubai Land Department (DLD), a regulatory authority, oversees the real estate market in Dubai through the Real Estate Regulatory Agency (RERA). RERA enforces the laws regulating the real estate market and provide a legal framework for all parties involved.

You cannot work as an independent real estate agent in Dubai. To apply for a Brokers Permit, you must be an employee of a licensed real estate brokerage. The licensing procedure is easily accessible to nationals of the UAE and the GCC.

In Dubai, a real estate broker is a more seasoned and senior professional who has often held the position of real estate agent for a number of years. They need to pass further examinations and fulfil the DLD’s standards for education and experience in order to become brokers.

Both the real estate agency they work for and the agent must be RERA-registered. Following registration, the broker is given a Broker Registration Number (BRN), and the agency is given an Office Registration Number (ORN).

You must receive a real estate brokerage permit from the RERA in order to engage in real estate brokerage operations in Dubai, where the permit will enable you to represent yourself as a legitimate real estate broker.

You can sell your home directly, without using a broker, mediator, or other intermediary. You won’t be restricted by any laws or regulations to accomplish this.

Enrol in the RERA-approved Certified Training for Real Estate Brokers at the Dubai Real Estate Institute (DREI) to become a real estate agent in Dubai. This 4-day course is designed to provide aspiring realtors a thorough understanding of Dubai’s real estate industry, legislation, and practises.

This exam will cost about AED 3,200 if you have a bachelor’s degree in a related discipline. You will need to spend AED 6,300 for the exam if you do not have a bachelor’s or master’s degree.

All you need to do is submit your DREI course completion certificate, proof that you passed the RERA exam, and a certificate of good behavior. The Economic Department will accept you and award you a Broker’s License a few days after you’ve submitted these documents.

In the UAE, mortgages are offered with fixed or variable interest rates. Although they might be as short as one year, fixed durations are often five years or longer. The agreement switches to the bank’s variable rate at the conclusion of the fixed period.

Fixed rates start at 4.24% and variable rates start at 0.55% plus three months of EIBOR Obtain preapproval.

You must obtain around 70% to pass the test. The test typically comprises multiple-choice questions and is offered at a number of centers from which you can select. After passing the test, you receive the RERA certificate.

An agreement that let a person borrow money from a bank or other comparable institution, particularly to purchase real estate.

The maximum mortgage term in the UAE is 25 years, with a 65-year age limit for salaried people and a 70-year age limit for self-employed people.

A minimum monthly salary of AED 15k is often required by UAE banks in order to be eligible for a property loan. The minimum wage requirement for an ADCB house loan is AED 15,000, despite the fact that some banks may approve applicants with a monthly salary of AED 10,000, according to the ADCB Dream Home platform.

A minimum monthly salary of AED 15k is often required by UAE banks in order to be eligible for a property loan. The minimum wage requirement for an ADCB house loan is AED 15,000, despite the fact that some banks may approve applicants with a monthly salary of AED 10,000, according to the ADCB Dream Home platform.

It’s the buying and selling of real estate before the building construction is complete. Only the completion plan exists for this.

In the event that the project is halted or abandoned before it is completed, buyers can even lose the money they have already paid. Before purchasing off-plan real estate in Dubai, be sure the developer is reputable and well-established. But if you pick a reliable developer, you can get around this problem.

Yes, however the maximum loan-to-value ratio for off-plan mortgages in Dubai is 50%. The kinds of properties and projects that banks are ready to fund are likewise subject to certain requirements.

The UAE Central Bank needs a 20% down payment (15% for UAE residents) plus associated charges in order for a first-time buyer to be approved for a mortgage. For properties under AED 5 million, foreigners and non-residents are obliged to put down at least 20% of the purchase price (15% for UAE citizens).

The fact that off-plan houses are sometimes more affordable than completed ones is one of the biggest advantages of making an investment in them. To entice customers, developers provide discounts and alluring payment options, making it simpler for everyone to acquire property in Dubai.

Both before and after the project is finished, the investor is allowed to sell off-plan residences in Dubai. Investors must adhere to the developer’s restrictions and requirements if they wish to sell their off-plan home before it is finished.

Off-plan real estate in Dubai offers early-investment advantages to investors. This implies that investors can purchase a home at a lesser cost before it is finished and enjoy the capital growth that takes place when the property is being built.

Secondary properties are ones that are already on the market for rental or sub-sale but are being rented out or inhabited by the owner.

Overall, Dubai is a desirable site for investors wishing to diversify their portfolios due to its stable economy, advantageous location, tax-free market, safe environment, contemporary legal system, high return on investment, world-class infrastructure, and dedication to development and innovation.

According to a survey done by Bayut, a well-known real estate portal in the UAE, the typical ROI in Dubai for residential properties is between 5-7% and 7-9%.

The residential market had sales of over AED 93 billion in the first half of the year, a 46.7% increase from 2022, while the commercial sector saw sales of AED 2.86 billion, an increase of 30% from 2022.

The developer’s ongoing and recent releases of new properties make up the bulk of the market. The secondary market consists of second- or sub-sale properties, previously held homes in established neighborhoods, and secondary or sub-sale real estate.

The “Strategic Plan 2026” seeks to increase the GDP contribution of Dubai’s real estate industry through 2026. The heart of the strategy consists of five pillars. A strategy plan to make Dubai a world leader in the real estate investment sector was revealed by the DLD of the UAE.

There are some really alluring rental returns available for commercial real estate in Dubai. For instance, office properties in Dubai earned an average rental return of 7.4% in 2018, per JLL’s 2019 City Momentum Index study. This was far higher than the 5% average for the entire world.

The top 10 areas with highest rental yield in Dubai in 2023 are:

  • Al Barari
  • Za’abeel
  • Dubai Marina
  • Dubai Hills Estate (Villas)
  • Jumeirah Golf Estates
  • Jumeirah Beach Residence
  • Business Bay
  • Downtown Dubai
  • Palm Jumeirah Apartments
  • City Walk

In Dubai, the municipality tax on real estate is now charged at 5% for residential properties and 2.5% for commercial buildings, based on the yearly rental value. The transfer of real estate ownership may be subject to a registration charge.

Requesting the valuation of a residential apartment in Dubai or a villa, the customer needs to pay the following fees:

  • AED 4,000.
  • A Service partners fees of AED 230 + VAT (If the customer applies at the Real Estate Services Trustees Centres)

Your rental yield, for instance, would be 10% if you owned a commercial property worth AED 1 million and earned AED 100,000 in rent from it over the course of a year. In general, the better, the higher the rental yield. That’s because it indicates that you’re earning more money than you did when you bought the property.

People shall be considered tax residents if they have a physical presence in the UAE for 183 days or longer in a 12-month period in which it has been their customary or major place of residence and the centre of their financial and personal interests.

The Land Department may provide the Rental Valuation Certificate, which reflects the current market worth of the property in Dubai, based on the documentation supplied. In the event of a disagreement or to increase Dubai rent, landlords may cite this Certificate as an official reference.

In the UAE, there is no capital gains tax. Capital gains are taxed along with corporate profits for taxpaying organizations.

There is no tax on any kind of personal income. Salaries, pensions, rental income, and capital income from dividends, interest, and various types of capital gains are all included in this. Additionally, there is no wealth tax and no taxation on real estate.

A list of specific developers and builders whose homes and projects have been given funding approval.

A deferred payment is one that is not made immediately.

Emirates Interbank Offer Rate is what it stands for. The interest rate that the UAE’s top creditworthy banks charge one another for borrowing money. Typically, businesses utilize this base rate as a baseline for figuring up their profit margin.

Equated Monthly Installment or EMI is a payment plan with a fixed monthly installment throughout the decided duration.

Investors are required by the escrow law to hold aside 5% of the total cost for a year. This procedure is used to address any problems or defects that may develop with the project. DLD must provide the developer permission before creating and registering an escrow account.

A sum of money paid at the time of purchasing real estate but included in the overall price. The remaining sum is often paid overtime or following the conclusion of the contract.

This is a different bank account where money is held in trust and is protected by a third party who has obtained RERA approval. All Dubai real estate developers must now adhere to escrow regulations when accepting investor payments.

The DLD has prohibited access to this account. This account is not open to the property developer’s free withdrawals or discretionary use of the funds. Thus, until the delivery of the property, the money paid by the purchasers of the various parts of a program is secure.

Escrows are primarily used to make sure that each party fulfills their commitments.

The documents required to open an escrow account are:

  • RERA approval
  • Escrow Account Agreement and Account Opening forms signed.
  • Land Title Deed /Sales & Purchase Agreement in name of developer
  • Trade License
  • Commercial Registration
  • Chamber of Commerce Certificate or Offshore company documents

Flip refers to when an investor buys a property with the intention of profitably selling it.

One of the major risks is that, if you’re not careful, you can lose money. Before you begin, it’s crucial to complete your research and have a well-thought-out plan. Going it alone is generally not a smart option if you have no prior expertise investing in real estate or flipping houses.

For Memorandum of Understanding (MOU) is the document, which was printed in three copies, is frequently used in Dubai to certify a sale and purchase between a buyer and a seller. It includes details such as the purchase price, the terms and conditions, and the due date. It is possible to refer to this document as a Sale and Purchase Agreement (SPA) or a Contract of Sale.

A Facility Offer Letter is a letter that the business provides to the buyer as a request for financing the purchase of real estate.

The fix-and-flip method is buying a property, making renovations, and then reselling it for a profit. Due of its condition, investors frequently purchase real estate at a discount. It could have fallen into disrepair as a result of abandonment or because the present owner was unable to afford maintenance.

The holding cost will increase if you keep the property for a longer period of time. Therefore, you will lose a sizable portion of your money if you are unable to locate a buyer in time. Stress follows you while purchasing or selling a home. If you’re a novice in the market, flipping houses might be difficult

An abbreviated form of “power of attorney.” A legal appointment has been made for one person to represent another in their absence. The legal authority to make decisions and sign papers is subsequently granted to the appointee. According to requirements for the UAE legalization procedure, all powers of attorney must have valid notarizations and attestations.

The Dubai Municipality established the Rent Committee. The committee resolves disagreements and legal infractions between landlords and tenants.

A title deed, which is acknowledged and recorded by the Dubai Lands Department, certifies ownership of a property and registers it with local authorities.

In Dubai, homeowners are required to pay periodic fees for the upkeep and repair of residential communities or structures. They encompass a variety of property management facets, such as upkeep, cleaning, security personnel, landscaping, and general building/area care.

This is the total square foot of floor space, excluding any shared or communal sections such as hallways, stairwells, lift, and entryways.

Title Papers are the documents pertaining to real estate held in a certain person’s name.

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