This Guide is intended to explain the typical steps involved in buying a property in Dubai. The Guide is free to everyone, not just members of empirepropertiesdubai.com. After reading it, you should have enough knowledge to handle your purchase with confidence.
What service can I expect from an estate agent?
The real estate agent is paid by the Vendor, so they act for them not the purchaser. He is not obliged to highlight negative aspects of the property to you. The agent will show you suitable property for sale and put any offers to their vendor clients.
What costs do I need to consider?
There are a number of costs to be taken into account when buying property. Typically these are: –
- Solicitor’s fees (including stamp duty, local authority searches, etc)
- Part payments on council tax, ground rents, service charges
- About 10% deposit
- Property insurance and house contents insurance
- Mortgage (indemnity premium and arrangement fees – usually can be added to mortgage)
- Surveyor’s fees
- Removal firm
I’m a first time buyer, what’s the process involved?
Roughly these are the steps involved in buying property:-
- You find a property
- You get a mortgage and appoint a solicitor
- The mortgage company will carry out their valuation on the property
- You instruct a surveyor to do a home buyers report or full survey
- The Vendors Solicitor supplies draft contract, title deeds on the property to your Solicitor
- Your solicitor arranges for local search and raises any queries with the Vendor’s solicitor.
- Once your solicitor is satisfied you can proceed to signing contracts and agreeing a completion date.
- You provide the Vendor with the deposit
- Signed contracts are sent to you from Vendor
- Contracts are exchanged and you arrange insurance for the property
- Completion takes place on agreed date
- Your solicitor pays remainder of purchase price to Vendor’s solicitor
- Vendors solicitor confirms that sale is complete and arranges for keys to be handed over.
- You move in!
What survey will I need?
If you wish to appoint a Surveyor to prepare a report on the condition of the property then this should be done when your offer has been agreed. Normally, two types of Report are available, depending on the extent of information you require. You should ask your solicitor which type of survey is appropriate for the property you’re buying.
Mortgage Valuation Report– This one is carried out by the mortgage company to determine that they are prepared to lend you money to buy the property. Often their valuation can be up to 15% lower than the asking price- this is because they are always more cautious. It does not mean that the property will not sell for the asking price. It’s not advisable to rely on a mortgage valuation – the mortgage company has no legal obligation to you. So you should arrange either a Home Buyers or Full Structural Survey.
Full Structural or Building Survey Report– This survey can be a very detailed report depending on what agreed with the surveyor. It goes a few steps further than the Home Buyers report and is often recommended for property that is particularly old.
How should I choose a solicitor?
It is important to appoint a Solicitor who will deal with the sale of your property promptly. The cheapest might not be the one who looks after your interest best. It is essential the Solicitor is geared to handling residential sales, can be readily contacted and can deal with your work speedily. In our experience, it is in your interest to appoint a Solicitor who is fairly local.
What’s involved in the Solicitor’s role?
You may want to get your solicitor involved as soon as you make an offer (which should be made subject to survey). Your solicitor can then advise what steps to take if there are any problems with the survey.
When the buying processes start and the Vendor’s Solicitor has obtained the property title deeds etc from the Vendor’s Building Society or Bank, they will prepare the contract of sale. Your Solicitor will then examine the papers and raise any queries based on the title deeds, and related matters about the property.
When your Solicitor is in receipt of all replies to enquiries, a satisfactory local search, a copy of a mortgage offer, a signed contract and a deposit cheque, they can then proceed to exchange of contracts.
The deposit cheque is normally for a sum of 10% of the purchase value of the property. You therefore need this sum in order for you to progress to exchange. Exchange means the transaction is legally binding.
Completion is normally 28 days from the date of exchange. On completion your Solicitor hands over the remainder of the purchase money to the Vendor’s Solicitor.
At completion, not before that exact time, you can move into your new home. Keys will be handed over by the Vendor or estate agent.
What do I need to arrange at exchange of contracts?
Obviously, also see if a friend or neighbor can recommend a removal firm. Get more than one quotation and don’t base your decision on price alone.
Arrange insurance-Buildings & Contents- You will need to arrange insurance for your property usually when contracts have been exchanged. Your solicitor will be able to advice.
Services, Maintenance Contracts and Council Tax– It is important, in order to avoid unnecessary costs/avoid disconnection, that you notify the service authorities (gas, water, telephone, electricity) of the date that you will be moving from your property. Also you’ll need to notify the service authorities in the area you are moving to of your move in date.
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