30.04.2024 21.05.2024 59 0 0
Buying real estate in the UAE can be a profitable investment, as the country remains one of the most attractive destinations for buying a home. Such investments help to save money from inflation, as well as to receive income from renting or from subsequent resale. Most often, buyers choose real estate in Dubai and Abu Dhabi, which is getting more expensive every year. At the same time, due to population growth, housing is in consistently high demand.
Restrictions for foreign buyers of apartments and houses in the UAE are minimal. Foreigners can freely acquire full ownership of housing in specially designated free-ownership zones. They can also take out mortgages from local banks, but loan terms may vary depending on the specific institution and the status of the borrower.
As for rental housing, the country has a regulated system that protects the rights of both landlords and tenants. The average return on investment in the most popular emirate – Dubai – is 5-8% per annum; in the most profitable projects it can reach 10%.
Potential buyers are interested in many nuances, starting from the procedure for choosing an object and ending with taxes and fees. In this article, we will answer frequently asked questions.
Is buying real estate in the UAE available to foreigners?
Yes, in the UAE, foreigners can buy real estate in freehold zones in full private ownership. These areas allow foreign investors to purchase both residential and commercial properties and dispose of them at their discretion. Investors can buy a plot of land or a villa in Dubai and own, sell and inherit their property in the same way as UAE citizens do.
Also, the leasehold format is available to foreigners – a long-term lease. Such objects are usually cheaper, and the right of ownership is limited to a fixed period, for example, 99 years with the possibility of extension. The owner also has his own rights, but some points will need to be coordinated with the main owner.
The variety of ownership formats and the availability of freehold, including land, make the country an attractive place for international investors seeking to invest in a steadily developing and regulated market.
What are the risks associated with buying real estate in the UAE?
Investing in housing in the United Arab Emirates provides potentially profitable opportunities, but at the same time involves certain risks. Here are the general points that should be taken into account:
- Market volatility. No country is immune from price fluctuations, although the UAE in recent years has demonstrated not only stability, but also a steady increase in the value of real estate. In the long run, the investor always wins here.
- The reliability of developers and their ability to complete projects on time. In the UAE, this issue is regulated at the legislative level. The buyer is protected from financial risks, as the state controls every stage of construction, and investors’ money is stored in escrow accounts.
In general, the country’s real estate market is stable and safe, it is only important to use the services of professional brokers who have a license.
What are the additional costs of buying a home in the UAE?
When buying, it is important to take into account not only the cost of the object, but also a number of additional costs, such as:
- collection to the Land Department of the Emirate. It is 4% of the cost of the facility, plus administrative fees from 40 to 580 AED (from 10 to 160 $);
- the agent’s commission is usually 2% of the price;
- administrative fees – from 2000 to 4000 AED (from 550 to 1100 $) + 5% VAT;
- service fee. Annual fees for the maintenance of public infrastructure are available in any complex, their amount depends on the type and size of the residence.
What do you need to know when choosing an apartment or house and then making a deal?
Simple but important steps to follow:
- Checking the reputation of the developer. If you plan to buy an apartment in a new building under construction, it is important to familiarize yourself with the ready-made projects of the developer, with the deadlines and his financial condition.
- Analysis of the area. An assessment of infrastructure, development plans for the territory and a forecast of price dynamics will allow you to get a clear idea of how suitable the chosen option is for living and investment.
- Assessment of the complex. The cost of housing differs not only depending on the type or area, but also the degree of well-being of the project. To find the optimal object, it is advisable to know the specifics of the market. For example, the availability of a public swimming pool and gym in the UAE is the norm, and the number of bathrooms in many residences matches or exceeds the number of bedrooms.
- Consultation with a realtor. Professional assistance in the purchase of foreign real estate is extremely important. They will tell you about the features of a particular area or developer, help you make a smart choice and arrange all the necessary documents.
Can foreigners get a mortgage?
Yes, you can take out a mortgage loan to buy an apartment in Dubai or another emirate, and this is available for both local residents and foreign citizens. The UAE Central Bank sets certain rules for the provision of mortgages:
- The initial payment for foreigners wishing to buy a property worth up to 5 million AED ($1.36 million) is more than 20%. If the price of the property exceeds the announced amount, the minimum down payment is increased to 30%.
- Additional conditions are set by specific banks. These may include a credit check, proof of stable income, and other financial guarantees necessary to prove the borrower’s ability to meet mortgage obligations.
How to rent a property in the UAE?
To rent a house for a long-term lease, you must obtain permission from the Dubai Land Department (DLD). After receiving it, you can start searching for a suitable tenant, independently or through an agency. As soon as the tenant is found, it is necessary to draw up a contract, specifying in it all the key conditions, such as the lease term, its cost and the conditions of maintenance of the object.
Then the contract must be registered with the Real Estate Regulatory Agency (RERA), which is a mandatory requirement and helps protect the rights of both parties. Those who do not live in the country can use the services of a real estate management company. She will handle all matters related to the lease on behalf of the owner, including marketing, checking tenants, monitoring the condition of the property and ensuring timely payment of rent. This approach allows you to reduce personal employment in the process of renting an apartment and ensure compliance with the legislation of the country.
To rent a property for short-term rent, you need to register with the Dubai Department of Economy and Tourism (DET).
Why do investments in the country have a high return?
The high return on investment (ROI) in apartments and houses is due to a number of factors. The Emirates attracts a large number of tourists and expats due to its openness and diversity of cultures. The state is known for its high degree of security and well-developed infrastructure, which makes it an attractive place to live and work. A stable economy and favorable geopolitical conditions also play an important role, which strengthen investor confidence.
In addition, a loyal tax policy, including the absence of a tax on personal income and profits, makes investments in housing even more profitable. All these factors together contribute to a high return on investment.
Quote:
Metropolitan notes that Dubai has the highest ROI rates. On average, they range from 5 to 8%.
We answer your questions
Can foreigners buy real estate in the UAE?
Yes, foreign citizens can purchase in specially designated zones (freehold) and in leasehold in many other locations.
What is the profitability of housing in the UAE?
The exact figures depend on the specific type of property and the emirate. In Dubai, the average is 5-8% per annum.
Which facilities have the highest profitability ratio?
As a rule, these are studios or 1-bedroom apartments.
In which emirates is it more profitable to invest in real estate?
Dubai and Abu Dhabi occupy the leading positions.
Is it possible to obtain a UAE residence permit when buying a property?
Yes, the minimum investment amount and the duration of the residence visa depend on the specific emirate.
Comments
Vadim Bolotov: “I thought for a long time before deciding to buy. The most confusing question was how I would rent an apartment without being permanently in the country. But I took a chance, took a studio and found an agency that deals with the trust management of my house. I’ve been earning income remotely for 1.5 years now, and now I’m thinking about investing in another apartment, but at the construction stage.”
Vladislav Yartsev: “It is much more profitable to buy in Dubai than in Europe. The area is larger, there are many new apartments on the market. I took a studio in JVC – fresh decoration, a swimming pool in the house, a rocking chair. You can’t buy a closet in Europe for the same money.”
English 
Russian 
German 
Polish