Are you wondering how to save money for a house down payment in Dubai? If so, then you must read this guide. Here, you will find 10 tips on how to start saving up for a house down payment. Starting with setting a budget to separating what you want from what you need. So, find out here how to save money to get a house down payment.
- Create a Budget
- Payment Savings Plan
- Pay Off Debts
- Manage Expenses
- Understand Required Payment
- Save Up on Rent
- Consider a Savings Account
- What is Necessary and What is Not
- Increase Income
- Stay Committed
- FAQ
How to Save Money for a House Down Payment – 10 Helpful Insights
While these tips may seem easier said than done, they are still very easily doable. Owning property in Dubai is a great investment. It brings both security and a sense of belonging to the city. If you are considering becoming a homeowner in Dubai. Follow these steps to start saving up for your dream home’s down payment.
1. Create a Budget
The first tip on how to save for a down payment on a house is to set a financial budget. This includes tracking down your income in accordance with your expenses and calculating how much you can save up. In addition, to set a budget, make sure to establish a time frame – meaning how much you want to save up during a time period. This time frame will help you set a realistic budget and actually save up.
2. Find a House Down Payment Savings Plan
Secondly, setting a budget is like highlighting your end goal. Here, the end goal is to save up a down payment for your dream house. Therefore, to achieve this goal, you are in need of a smart strategy. This strategy can include the additional tips listed below, such as increasing income and decreasing expenses. Also, it can include searching for programmes that can aid first-time homebuyers with the down payment.
For example, you can submit an appeal to get a housing assistance amount. This appeal is sponsored by the Sheikh Zayed Housing Programme, as stated on the official portal for the UAE’s government.
3. Pay Off All Debts and Start Fresh
One of the best tips on how to get money for down payment on a house is to be debt-free. It is an essential step to allow you to achieve your final goal which is collecting your down payment. In addition, this includes avoiding future debts as well. This means fully avoiding using credit cards, as using them will only result in more debt.
On the other hand, if you are trapped in long-term debts, try to work your way around them. In other words, try to stick to low interest rates, avoid piling up monthly debt bills, and minimise your credit card spending.
4. Manage Your Expenses
Moreover, being frugal is key to saving up money for any big project such as owning a home. When it comes to managing expenses, one must try to save up on utility bills for starters. This is a very simple precaution that allows you to reduce your bills total on a monthly basis. How so? First, manage your water consumption. Make sure you have no leaks in your current home so the bill won’t pile up.
Secondly, manage your electricity usage through various steps. For example, avoid using electricity during peak hours and buy energy-saving appliances. While these expenses may not look much, saving up on them will show a great change in the long run.
5. Understand the Required Down Payment
To set a realistic budget, make sure to familiarise yourself with Dubai’s down payment amounts. Note that every down payment for a house may differ based on various factors. For instance, such factors would include the developers, type of property, and property features and configurations.
In addition, if you are seeking to own a house in Dubai, you may want to explore the developer’s down payment options. For example, Damac Properties offers flexible down payment plans so you can own your dream home easily.
6. Save Up on Rent
Renting out an apartment or villa in Dubai can cost a distinctive amount. Hypothetically, if you spend AED 15,000 monthly on rent, consider opting for a cheaper apartment. Say you move to another location that costs AED 10,000 – then you can save AED 5,000 a month. That is a great amount to go to your down payment fund every month.
7. Consider a Savings Account
If you are the type of person who does not know how to start saving up. Then you may want to look for help from automated saving plans – which is what you will get when opening a saving account. These plans will increase your savings by transferring a certain amount of your monthly salary into them. Thus helping you achieve your down payment budget. What is great about a savings account, is that it tucks away your money safely. So you would not be tempted to spend it.
8. Highlight What is Necessary and What is Not
In addition, the best way to save money for a house is to separate what is necessary and what is a luxury. Life in Dubai is very tempting, and you may catch the allure that will cost you more than it should. Therefore, differentiate between what you want, and what you need.
Also, make sure to avoid unnecessary expenses. This would include monthly subscriptions, shopping expenses, eating out, and so on. Keep reminding yourself of your goal when you feel the urge to make an unnecessary purchase.
9. Find Ways to Increase Income
One of the best ways to save money for any big project is to increase income. You can do so by asking for a raise from your current job or finding other ways. For instance, you can seek smart investments that will bring you extra income. Also, you can find yourself a second job to get more income, such as opening up a side business or freelancing.
10. Stay Committed
Lastly, when it comes to figuring out how to save money for a house down payment – one must stay committed. In a more slang context – keep your eyes on the prize. This way, you will stick to your goal of owning the house of your dreams and actually achieve that. So, make sure not to lose focus no matter how complex things get.
FAQ
For expats, the down payment would be estimated as 25% of the total property value.
UAE nationals would pay a 20% down payment of the property’s total value as a minimum down payment.
This depends on the bank you are doing business with. Regardless, make sure you understand your mortgage options and terms to make the best decision for you.
You can do so in the case of property exchange. Other than that, you would rarely find a house with a zero down payment.
In conclusion, when it comes to how to save money for a house down payment – it is a no-brainer. The catch is to actually stick to the tips this guide offers and commit to them in order to own your dream home. In addition, make sure to explore Property Finder’s blog for more guides.
