Whether you’re a first-time buyer eager to enter the market or a seasoned investor, here are 10 tips for anyone looking to take the plunge.
1. Work with a certified agent
A good agent can relieve the stress of house hunting, so make sure you get recommendations from family, friends or co-workers or use our Find Agent section to browse verified agents. Whilst looking for a property, ensure that the agency you’re dealing with is licensed. Ask the agent to provide a copy of his/her RERA card.
2. Check prices of comparable properties in your area
Run a search on propertyfinder.ae to get an idea of what you can expect to pay for properties in the area where you want to live.
3. Try and pick a future property hotspot
Find an area where prices will go up, rather than move where increases have already been felt. Even if you’re on a modest budget, you’re also investing in your future. Here are some questions you should ask as a starting point to identify the next boom area. What is the availability of new property in the area? Is it adjacent to a prime suburb? What are the major infrastructure projects presently running or planned for the next few years? Are there good transport links? Is it proximal to a large shopping centre or school?
4. Run the numbers
Can you afford to buy? Do you have funds set aside for a down payment? Break down your monthly bills and use the mortgagefinder.ae online mortgage calculator to see how much you can afford to pay on a mortgage.
5. Start saving for the down payment
In the UAE, mortgages are restricted to 50% for off-plan properties. For first, already built investments worth less than AED 5 million, expats can borrow 75 percent of a property’s value and nationals 80 percent. More expensive homes restrict expats to borrowing 65 percent of the property’s value and nationals to 70 percent. For second and subsequent property purchases, expats can borrow just 60 percent of a property’s value and UAE nationals up to 65 percent, regardless of cost.
6. Consider the ‘hidden’ costs
At the time of transfer, you will need to pay 2% in addition to AED 315 to the Land Department, the purchase price to the seller plus the agent’s commission. For newly built developments, expats can expect to pay roughly 2% on land registration fees on top of this. The maintenance fee, which covers the upkeep of the building, gardens and shared facilities, can be fixed or vary depending on the size of the property. Removal and other associated charges can also add to the burgeoning cost.
7. It doesn’t stop once you’ve purchased
Maintaining a home can be expensive. Unexpected repair costs can crop up, so make sure you have money set aside for such expenses.
8. Don’t view too many properties
Viewing too many properties can get overwhelming, so make a list of absolute must-haves and work with your agent to narrow down your search. Try to learn about the neighbourhood by visiting it at different times of the day and throughout the week.
9. Conduct a home inspection
Don’t leave anything to chance. Have the apartment or villa checked by a certified home inspector to understand its condition. This will help you arrange for repairs to be made prior to purchase or to budget for the repairs needed and ask for a price reduction. Knowing the property you’re looking to buy will help you discover hidden problems and look out for areas that need watching.
10. Make a realistic offer
Don’t haggle. Work with your agent to make a realistic offer taking into account what you can afford and the prices of comparable properties in the locality.
