Can foreigners buy property in Dubai?
Dubai is a young, growing metropolis. It is beneficial to have your own housing here: every year, both square meter prices and rental demand are rising. And this means that real estate investments will bring income sooner or later.
Can foreigners buy property in Dubai?
The opportunity to purchase real estate by foreigners
Until 2002, foreigners could not purchase real estate in Dubai – they were given only the possibility of long-term leases for a period of 10 to 99 years. Now real estate in Dubai is in great demand among foreign buyers, however, you can only buy an apartment, house or plot of land in the freehold zone.It includes 23 most popular among visitors to the city district. Among them, mainly, the areas of the “new Dubai”: Dubai Marina, Palm Jumeirah, Peace Islands, Dubai Downtown and others. Also available for buying an apartment in the highest skyscraper in the world, Burj Khalifa.
The conclusion of a sale of real estate in Dubai has a strict sequence. The property is withdrawn from sale immediately after the buyer confirms his choice and makes a deposit of $ 2700. Payment in cash is not accepted – the seller deducts funds from a credit card. After that, both parties make an appointment to sign a contract of sale. The contract must necessarily reflect all the terms of the transaction:
the value of the property;
transaction completion date;
terms and procedure for payment by the buyer of the remaining purchase amount;
responsibility of both parties.
After signing the contract, the buyer makes a deposit of 10% or more of the total cost of the object. Further, the developer gives the seller permission to sell. This document is required to register the transaction with the Land Department. The buyer pays the remaining amount at the time of registration of the property or immediately after it. He can receive a certificate of ownership only if the seller receives the full amount. A loan for the purchase of real estate in the UAE is issued only to citizens and residents.
Dubai Property For Rent
It is most advantageous to rent out an acquired property, all the more so, in 2016, the emirate authorities simplified the terms for renting a house. Now the buyer can both look for tenants on their own, and turn to the services of the agency, while he does not need to receive special permission. It is important to remember that renting property in Dubai is allowed only to citizens or residents of the UAE. At the same time, the owner can not rent rooms separately – only the entire room. After signing a lease agreement similar to the sales contract, the tenant pays the rent for the year, as well as 5-10% of it as a guarantee deposit. The net profit of the lessor, taking into account the costs of servicing the apartments or villas, will be about 10%. It is more profitable to purchase retail space for subsequent leasing: they will bring 15% of the profit from the amount paid by the tenant.
Real estate located in the freehold zone can be resold over time. Now the cost of economy class apartments starts at $ 2000 per square meter, and luxury villas and apartments – from $ 7000. Every year, real estate in Dubai rises in price, and the resale of a property bought several years ago can bring tangible income. In addition, competent redevelopment and design repairs in housing will significantly increase its cost. A new buyer, purchasing a secondary property, will have to pay 2% of its value from above. That is why it is important that the property sold is worthy of competition for new apartments and villas. High-rise apartments with panoramic windows and views of the Persian Gulf are always in great demand.
Other ways to profit from real estate in Dubai
In addition to buying property abroad, investment in trust companies is gaining momentum. These companies entirely redeem profitable buildings thanks to funds received from investors, and then rent them out or sell them. Investors are given the opportunity to monitor the invested funds, and companies pay them interest on profits. Such a business is actively developing in Dubai. Before investing in a trust company, it is important to evaluate its prospects.