This blog is a complete guide on Dubai Mortgages for Non Residents in UAE.
Are you a Non-resident searching for the best property to purchase in UAE? If so, this guide will let you know about the things you need to know before you explore the search.
The number of non- residents people across the world have started investing in buying villas and apartments in the UAE, some of the people prefer tax free capital gains, some others looking for lifestyle investments and few other needs tax free rental yields that can reach about 10% primarily on the smaller apartments.
UAE Market have seen both ups and downs in the real estates, there was a recent change occurred in the UAE regulations and this has made non-residents people to overseas purchasers and has brought a significant impact on their industry.
What places can Non-Residents Purchase in the UAE?
They can be classified into three regions namely Abu Dhabi, Dubai, and The Northern Emirates.
Non-GCC National people means the one who is not from Kuwait, Bahrain, UAE, Oman, Qatar and Kingdom of Saudi Arabia is capable of getting freehold and leasehold property in specific investment zones around the Abu Dhabi which includes Reem island, Yas Island, Al Reef Village, Raha Beach, Saadiyat Island and much more.
If you are a foreigner and not a person who currently lives in UAE, then Dubai law states that you are capable of purchasing a freehold property in any of the twenty-three freehold areas namely Emirates Hills, Al Barsha South, Dubai Marina, Sheikh Zayed Road, Palm Jebel Ali, Palm Jumeirah and much more. You can also get from any of the leasehold properties.
The Northern Emirates:
Non-residents can purchase both leasehold and freehold properties in Umm al Quwain, Sharjah, Ras Al Khaimah, and Ajman, and you can buy most of the property as the leasehold basis.
Is it possible to get a Mortgage to buy UAE Property as a UAE Non-Resident?
Yes but with restriction! Non-UAE residents are provided rights to buy a mortgage from the UAE lenders with few limits, the UAE Mortgage Cap law needs the Non-UAE people to have down payment cash of 25% of the property value added to the cost of purchase, this is 20% of UAE nationals.
The price may increase to 35% added to the property cost if it goes above AED 5 million, whereas it’s 30% for the nationals of UAE. In the case of getting a second or third property then you need 40% as a down payment cost added to the value of the property.
Down Payment Cost Requirements for Non-Resident and Expats (Non-UAE Nationals)
● If your purchase type is first property and the purchase price is below AED 5 million, then your minimum down payment is 20%, and maximum loan to value ratio (LTV) is 75%.
● If your purchase type is first property and the purchase price is over AED 5 million, then your minimum down payment is 35%, and maximum loan to value ratio (LTV) is 65%.
● If your purchase type is second or third property and the purchase price is any cost, then your minimum down payment is 40%, and maximum loan to value ratio (LTV) is 60%.
● If your purchase type is under construction or off plan and the purchase price is any cost, then your minimum down payment is 50%, and maximum loan to value ratio (LTV) is 50%.
Few steps Non-resident can follow while purchasing a Property in UAE.
Follow the below steps before you purchase a property in UAE as an expat or foreigner.
● Explore what property type you are going to purchase, apartment or villa, commercial space or land or a plot.
● Research in-depth for the available properties online.
● Contact a developer directly or real estate agent or familiar person to know the details of the properties thoroughly.
● Make sure whether nonresident people have the right to purchase the land, you need to have a steady salary as well as should be legal to live in the UAE.
● Choose the right property after checking every document wholly and then pay your deposit.
● You can purchase a home loan or mortgage from any famous, reputed or trustworthy financial institution.
● Transfer deeds and pay the land registry tax correctly.
Fees and Taxes you need to pay
● Abu Dhabi Transfer Fee – 1% to 2%.
● Dubai Land Department Transfer Fee – 4% added to the 540 AED administrative fee.
● Registration Fees – 2000 AED added to the property below 500,000 AED.
● Mortgage Registration Fee- 0.25% of loan + AED 10 fee.
● Registration Fees Cont – AED 4,000 for property above AED 500,000.
● Mortgage Processing Fee- Up to 1% of loan amount.
● Valuation Fee – AED 2,500 to AED 3,500.
● Conveyancing fees (where appropriate) – AED 6,000 to AED 10000.
● Estate Agency Fee – 2% of purchase fee.
● Downpayment – 25% of property cost.
● Oqood fee, for off-plan properties – 4% of purchase price.
Documents needed for getting a Mortgage in the UAE
Most banks will ask for the credit reports from the resident country, liabilities details including loans, credit cards, one-year bank statements and an entire heap of documents.
You require a scanned copy of passport, last three months bank statements justifying that you are working in the present company. There are no requirements for credit check documentation, no liability letters or employment proof.
You also need to attend mortgage offer letter in Dubai at some specific stage of the process, and this cannot be neglected as its mandatory at the final step of purchasing at the DLD (Dubai Land Department).
It would be better if you also made sure about the additional cost included in the transaction of property such as the realtors commission, property valuation free, registering fees, the land department transfer fee and much more.
Are you interested in buying a property in UAE? To live yourself or whether as an investment or need any guidance on the UAE Mortgages? If so, you can request a free consultation with us.
You can use our contact form from our website and then submit your complete details, once we receive the request we will provide a team member from our side to give the consultation with you at some time and date.