Well done on deciding to buy a home in the
United Arab Emirates!
The United Arab Emirates combines luxurious living with a rich and vibrant culture, making it an appealing destination for homeowners. The administrative, financial, and legal procedures involved in purchasing a home can differ significantly from one country to another and may feel overwhelming. However, with the right guidance, your path to owning property in the UAE can be smooth and straightforward. Our comprehensive 10-step buyer’s guide is here to simplify the process and ensure your move is as hassle-free as possible.
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CHOOSE LOCATION AND SET YOUR BUDGET
The first and most essential step is to define your budget. If you’re paying in cash, ensure that your funds are accessible in the UAE when it’s time to transfer. Take into account the property price, a 2% agency fee, a 4% transfer fee for buying in Dubai, a 2% transfer fee for properties in Abu Dhabi, and potential mortgage interest (usually around 3-4%). Once you have your budget in place, consider the different neighborhoods you’d like to explore in Dubai or Abu Dhabi. Keep in mind that not all properties can be purchased by foreign passport holders, so focus on freehold areas. For the latest updates, consult with our experts. Freehold properties provide you with complete ownership of the property and the land it is situated on. You can easily browse available properties in the UAE and take virtual tours of any residence that catches your eye, complete with high-quality photos and videos.
ARRANGING MORTGAGE
If you require a mortgage, enlisting the help of a reputable mortgage advisor is essential. They can facilitate bank pre-approval, which will determine your spending limit. Remember that a minimum down payment of 20% is necessary for mortgage approval when purchasing first property in the UAE if the property’s value is below AED 5 million. For properties valued above AED 5 million, a minimum down payment of 30% is required. To arrange a call with one of our trusted mortgage advisors, or to try our mortgage calculator, click here.
CHOOSE A REGISTERED AND QUALIFIED BROKER
After establishing your budget, it’s important to find a trustworthy, qualified, and registered broker who can help you discover your Dream Home or Investment Property. A qualified broker is a real estate agent in the UAE certified by the Real Estate Regulatory Authority (RERA) or Abu Dhabi Municipality (ADM). To formalize your negotiation and representation, you will need to sign a Form B contract or a Memorandum of Understanding (MOU) with your broker. The government provides a free online resource to verify an agent’s credentials. You can visit their website or download the “Dubai Brokers App” to search for brokers by name, company, or their unique Base Registration Number (BRN). Additionally, don’t hesitate to request the agent’s physical RERA card to ensure the BRN matches the information you find online.
PROPOSE AN OFFER
Obtain mortgage pre-approval and have your 10% deposit prepared to expedite negotiations once you’ve identified your Dream Home and are ready to make an offer. This deposit is typically held in escrow by the agency until the sales transaction is completed.
DEPOSIT PAYMENT
Upon agreement on the price by both parties, they will sign a legally binding Memorandum of Understanding (MoU), referred to as Form F by RERA. The MoU must outline all the details of the agreement, including any rent or service charges due, as well as the agreed duration until the formal transfer takes place. This process is completed through the Dubai Brokers App in Dubai or through appointment at Abu Dhabi Municipality, and you will also need to provide a current dated cheque made out to the seller for 10% of the total unit price. Additionally, a post-dated commission cheque made out to your brokerage is required at this stage.
CHOOSE YOUR CONVEYANCER
An expert conveyancing services are generally essential to help with the sales process. A skilled conveyancer will guide you throughout the entire process and is tasked with conducting thorough examinations of the property’s title deed to confirm ownership and uncover any restrictions, thereby facilitating the legal transfer of the property from the seller to the buyer. Learn more about conveyancing here.
ACQUIRE NO OBJECTION CERTIFICATE (NOC)
Before the purchase can proceed, the seller must obtain a No Objection Certificate (NOC) from the developer of the property. This certificate guarantees that there are no unpaid service charges associated with the property.
SECURE THE PROPERTY
If the property you are purchasing has an existing mortgage, you will need to undergo a “blocking” process. The seller must obtain a liability letter from their bank, after which you will visit the Dubai Land Department (DLD) if you’re buying property in Dubai, or the Abu Dhabi Municipality (ADM) if you’re purchasing in Abu Dhabi to “block” the property. This process involves issuing four cheques: one made out to the seller’s bank for the outstanding mortgage, one to the seller for the remaining purchase price, one to the DLD to cover the 4% transfer fee (or 2% for properties in Abu Dhabi), and a final manager’s cheque* made out to the agency. *A manager’s cheque is a secure payment instrument issued by the bank to an individual who has purchased that cheque.
TRANSFER OWNERSHIP OF THE PROPERTY
On the day of the property transfer, you will convene with your broker, conveyancer, and the seller. Property purchases can only be conducted in cash or through manager’s cheques, so ensure you have these ready along with your original identification (Passport or Emirates ID). You will also need a cheque for the 4% transfer fee for the DLD or a 2% fee for the ADM. Once the transfer is completed and the sale is officially registered, you will receive your new title deed along with the keys or access cards to the property.
FINAL PROCEDURES
Congratulations on becoming a homeowner! The final task is to ensure that all utilities, such as gas, water, electricity, and air conditioning, are registered under your name.
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