Your Complete Guide to Investing in an Affordable Real Estate Property in Dubai

According to research there are almost 8.4 million expats living in Dubai over the past two years. However, there aren’t that many expats who invest in property in Dubai because of high down payment rates, job security and lack of awareness of the real estate market.

Expo 2020 has created many investment opportunities in Dubai, the time is certainly perfect for people looking to invest in property. If you are ready to take the next step to buy property in the UAE, here is a complete guide on the process of buying an affordable property for investment purposes in Dubai:

Monthly Salary Requirements to Buy Property 

In order to qualify for buying a property in Dubai, you need to earn at least 15,000 AED per month. Keep in mind that there is a minimum 25 percent down payment required to purchase property and other fees also apply.

If you earn more than 15,000 AED and don’t have any major loans you would be eligible for a home loan of up to 25 years.

Investment Loan Options

A 25 percent down payment is required to be paid in cash for expats and 20 percent for UAE nationals. The rest of the amount can be arranged through the bank. The interest on a housing loan range from 2.99 percent to 5 percent, depending on the bank. Before you get approved for a housing loan the bank should first send a property valuation consultant to value the property, which will cost up to 3,000 AED. There is also an additional bank mortgage establishment fee, which makes up to 1 percent of the loan amount.

Another point you need to be aware of before applying for a housing loan is that buying life insurance is obligatory. The price of life insurance varies depending on the age, health condition of the investor and whether you choose to buy it from an external life insurance provider. Life insurance is essential when applying for a housing loan because it is the only way the bank can guarantee the loan will be paid in full in case of death.

Finally, once the mortgage is approved you will need to pay a service charge. The service charge is an amount you pay yearly to developers to cover landscaping, security, cleaners, communal electricity, pest control and building insurance. The amount you pay is calculated per square feet of the property.

How to Buy a Real Estate Property

The process of buying property in Dubai falls under the Dubai Land Department (DLD). First you will need to pay your real estate agency a 2 percent fee of the property value, and DLD will charge a 4 percent transfer fees, 2 percent to be paid by the buyer and the other 2 percent to be paid by the seller. Buyers will also have to pay a 250 AED title deed issuance fees.

To register the property with the DLD, you will need to pay a 4,000 AED registration fee if the property price equals or exceeds 500,000 AED, or pay 2,000 AED if the property price is less than 500,000 AED.

If you have a mortgage on the property you will need to pay a fee to the DLD calculated at 0.25 percent of the housing loan.

Which Areas are the Best to Buy a Property

If you’re looking to invest in property you should be aiming for smaller properties, because they require less service charges which can later affect your ROI.

Bellevue Towers located in Business Bay is a great place to invest in, with access to the city’s greatest facilities like The Dubai Mall and Business Bay metro stations that are just a short distance away. It consists of a variety of one and three bedroom apartments that range between 810 to 2534 square feet. It is a very affordable and great investment, you can buy an apartment starting from 1,342,000 AED

If you’re looking to invest in an affordable townhouse in Dubai then Mudon in Dubailand is a great place to invest in. Mudon Dubai offers a dynamic living experience with all the amenities you need for a modern lifestyle. A 1,550 square feet three bedroom townhouse starts from 1,399,890 AED.

Dubai Wharf located in Al Jaddaf Waterfront is considered to be one of the best areas to invest in Dubai and an ideal place for residents to explore old and new Dubai.. Dubai Wharf has a range of studios, one bedroom, spacious two bedroom and three bedroom apartments. It’s ten minutes away from Dubai International Airport and Downtown Dubai.

Here at Dubai Properties, our property managers are committed to helping you through every step of your real-estate journey – get in touch to learn more today.