Buyer's Guide

Any person of any nationality, whether based overseas or a resident of Dubai, can purchase in Dubai's property market.

By an individual:

• Passports for all Buyers • Signed Buyer Agreement known as Form B

 

By a company:

• Certificate of Incorporation • Memorandum and Articles of Association • Board Resolution • Power of Attorney • Signed Buyer Agreement known as Form B

By an overseas company:

• All of the above must be attested by the UAE   Embassy • Signed Buyer Agreement known as Form B  

In general, the Dubai Government issues residence visas to new property owners. These will be subject to the current immigration rules and regulations and need to be renewed 6 months.

Freehold is available on the majority of developments Smith & Ken handles. However, there is a mixture of freehold and 30-99 year leasehold property in Dubai.

In line with the growth that the Dubai Realty Market has experienced, local banks have expanded their mortgage market. Mortgages are available on a 10 to 25-year basis through Smith & Ken’s preferred Mortgage partner, Oxygen Home Loans. The advantage of using an Independent Broker rather than one mainstream bank is that you will receive an overview of all the products available not just a biased view towards one's product. Contact Oxygen Home Loans on +971 4 439 4322 begin_of_the_skype_highlighting              +971 4 439 4322      end_of_the_skype_highlighting for more information on current rates and offers.

There are currently no government taxes of any kind when purchasing a property in Dubai. Neither is there a capital gains tax. When the Dubai Lands Department registers the property title, buyers must pay a 1.5% registration fee based on the purchase price.

Buyers do not need a local bank account to arrange purchases, though these can easily be arranged through Smith & Ken Xtra, the additional ‘extra mile’ service for all our valued customers.

There are a number of fees involved. To register the property in the new property owner’s name, you are required to pay a transfer fee to either the Developer (Under Construction) or the Dubai Lands Department (Completed) dependent on the status of the property, and if you’re purchasing with a mortgage then there is also a payment of 0.25% of the value of the loan to be paid to either the Developer or Dubai Lands Department. In addition, should the property you’re buying be complete and already in use, there is a service maintenance fee to be paid to the seller on a pro rata basis. Smith & Ken charges 2% of the purchase price to the buyer as an agency fee which is payable upon the time of purchasing a property.

Service Charges are levied in order to maintain the various common areas and facilities of the community or the building and to generally ensure these are properly managed and administered. In many of the new property developments and residential buildings throughout Dubai, service charges are levied on the owners by the co-owners associations, and collected by a manager appointed on behalf of the associations. In a lease situation, these charges will generally be paid to the landlord. Services charges throughout Dubai vary widely, depending on the area and sophistication of the property in question. Larger community developments also charge their property owners an annual community charge, which is normally paid to the master developer of the project. We advise all our Buyers to find out their obligations to their Owner’s Association before purchasing a property.

Developers’ obligations to complete and handover property on time are dealt with contractually under the sale and purchase agreement (or as applicable, the lease agreement). If the property is not yet constructed, the agreement will typically provide an estimated handover date and usually the agreement will allow the developer a fair bit of latitude in terms of extending the date. As in many other regions, purchasers must be prepared to anticipate possible delays when awaiting possession of a property under construction. Once the property has been handed over, the developer has an obligation to provide a 10-year warranty to maintain the property.

Warranties covering defects in property are dealt with contractually, but it is common in Dubai for developers to repair general defects for a one-year period. There are codes of standards applied by the Dubai Municipality regarding building permits and contractual clauses. The developer will have to maintain the standards as stipulated in the regulations issued with regards to building construction, and also safety issues. In the event of a problem, assistance can be found from the contract entered into with the developer. This may contain building covenants, which often provide a guarantee of workmanship of 10 years. There is also the civil code of the UAE, which contains protection regarding building standards. Under the Civil Code, building engineers and consultants are liable for structural defects to a building for a period of 10 years.

Through Smith & Ken we will find you the property that’s suited to both your needs and wants. Once you have signed our Agency Agreement, we will begin our search and once we have found the property you’re looking for and a price is agreed with the seller, a deposit amount of 10% of the agreed price is required at the contract-signing stage of the Memorandum of Understanding (MOU). This deposit is held by Smith & Ken in trust. Once the MOU has been signed by both you and the seller, we will introduce you to Smith & Ken Conveyance who will be responsible in aiding you through the process and the completion of the procedures which will be finalized at either the Developers or Dubai Lands Department office. The transfer procedures and requirements are different dependent on the status of the property which is either under construction or completed. Our Conveyance team will provide all the guidelines and assistance and will ensure the property is transferred into your name as smooth and hassle free as possible.

Purchases normally take between two to six weeks to complete through Smith and Ken Conveyance who will handle the process on your behalf until the completion of the transfer.

You can sell your property to anybody. This means that they will either take over the payments to be made to the Developer should the property still be under construction, or pay 100% amount due to you should the property be complete and fully paid.

Smith & Ken can do this on your behalf provided a fee of AED 200 is paid in cash to Smith & Ken. For all details of connections and transfers, please visit www.dewa.gov.ae or call +971 324 4444.

Smith & Ken can help you rent your property. Currently in Dubai there is a healthy rental market and rental yields are between 8-10%, depending on the location.

Once you’ve signed our Agency Agreement, our Consultants will send you the Market Report for the area you’re interested in, along with details of the properties which match everything you’re looking for.