Property Buyer's Guide

   When property is selected, the first step buyer shall do is to make an offer to purchase through your real estate agent. Once the offer to purchase is accepted by the seller, and after the buyer’s ownership documents are verified, a deposit cheque amounting up to 10 % of the agreed purchase price is issued on the seller’s name. 

The deposit cheque shall be issued to the name of the title deed holder and probably agency will hold the deposit until the transfer day in Trustee office. In common practice, the deposit cheque is not cashed during selling documents preparation and is refunded to the buyer upon property transfer completion. The deposit cheque is usually refunded to the buyer on the transfer day upon receiving manager cheque for the full selling price by the seller.

Once the 10 % of deposit is received, the broker prepares the purchase contract between the buyer and the seller, known as form F which effectively balance the interests of both seller and buyer. The form F is approved by RERA and should set out what comes with the property you’re buying as fitted kitchen, furniture or parking space. 

After form F is signed, a No Objection Certificate (NOC) is applied for by the seller. NOC letter is issued by the developer company to ensure there are no outstanding service charges, debts or another issue with the property. The NOC process and fee may differ from one developer to another, but the minimum charges usually start from AED 500. 

After obtaining the NOC, the buyer prepares the manager’s cheque for the seller and here are additional expenses the buyer shall keep in mind:

1. The Dubai Land Department charges a property transfer fee that is 4% of the property value

2. Title deed acknowledge fee of AED 580

3. Property registration fee cost AED 4,000 + 5% VAT 

4. Agency commission of 2% + 5% VAT

At this stage, our company will calculate the balance of the service charges that must be refunded back to the seller from the day of transfer on pro rata basis. In the case that property is rented, the seller must refund tenant’s security deposit and the balance of the rent on pro rata basis.  

When we call it “off-plan buyer”

   In case you’ve chosen to buy an off-plan property from a developer, we recommend to do this through our broker company as the process of buying off-plan property might seems to be complicated. The benefits of buying off-plan property with our property agency is safety and you don’t have to pay any commission upon purchase price.  

   Once you decide to buy off-plan property, a token system is applied and in common practice amount of AED 5,000 or AED 10,000 shall be paid to the developer and which is not refundable. After token is paid, most developer companies are ready to grant several days to pay the booking fee which can start from amount of 5% form purchase price and Oqood fee.  

   Oqood registration is required for all off-plan properties and its developer’s responsibility to register off-plan property between developers and buyers. The developer prepares initial sales and purchase agreement which needs to be signed by both the buyer and the developer. A payment plan will follow with details of time frame scheme, amount and handover dates. Once the project is completed, the title deed shall be issued upon Oqood registration.

When we call it “mortgage buyer”

The first thing when planning to buy your property with mortgage, the mortgage pre-approval shall be obtained. 

Usually, Dubai banks will provide finance up to 75% of the purchase price depends on building, area and loan type. It means that you as a buyer must have at least 25% deposit as well as associated fees to contribute to the purchase.

Once a bank pre-approval is obtained, the buyer can begin viewing properties to their preferences and budget. Signing a sales agreement requires the buyer to give a cheque for 10% of the purchase price. A valuation is then requested and undertaken by an independent company which may take a few days subject to access to the property and will cost you around Dh 3,000.

Once the full valuation report is completed, it is submitted to the bank to confirm the contract price matches the current market value and the bank will move forward with their internal processes of obtaining final approval for the loan, including requiring the buyer to undertake a health assessment for insurance purposes and sign the final mortgage agreement. This process is solely between the buyer and their chosen bank.

Once the final approval is issued, the seller or both parties – along with their real estate agent – will visit the developer’s office to apply for the NOC. Once obtained, the bank proceeds with the final steps of preparing the offer letter for the buyer in order to prepare the manager’s cheques in the name of the seller.

Once all the cheques and the bank documents are ready, the bank books a date for the transfer at the trustee’s office and the property gets transferred to the new buyer’s name.