Buying Property in Dubai
Guide to United Arab Emirates - UAE (Dubai)
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The United Arab Emirates (UAE) is located in the Middle East. The country has seen vast growth in the business and tourism sectors over the last number of years which has contributed to a big construction boom throughout the Emirates. The country is well renowned for its sun, sand and duty-free shopping and is becoming a popular destination for expatriates due to its superb infrastructures and excellent tourist amenities.
The United Arab Emirates (UAE) comprise the seven member states of Abu Dhabi, the capital city, Dubai, Sharjah, Ajman, Umm Al Quwain, Ras Al Khaimah and Fujairah
Abu Dhabi
Abu Dhabi is the capital of the United Arab Emirates and is the largest of the seven emirates. It is a very modern city which is steeped in ancient culture. The emirate offers something for everyone from a bustling city (which is a shopper's paradise), to a number of beaches and beautiful scenery.
Dubai
Dubai has gained in popularity in the recent years and is the the second largest Emirate in the UAE. It is one of the fastest growing cities in the world and is waiting to be explored. In boasts sun shine every day of the year, modern facilities and infrastructures fused together with eastern hospitality.
The Palm Islands named 'The Eighth Wonder of the World' are the world's three largest man-made islands, which are being constructed on the coast of the Dubai – making this another ideal investment opportunity for this already popular Emirate.
Sharjah
Sharjah is the third largest of the seven states which form the United Arab Emirates and is unique amongst the Emirates in that it has coastline on both the West and East coast. It is a major business destination and over recent years many new attractions have been added to increase the tourist value of it. Sharjah is home to some of the most interesting architectural heritage in the country and is an area committed to its culture and preserving its unique Arabian lifestyle.
Ajman
Ajman is the seventh smallest of the emirates that comprise the UAE and is centrally located on the west coast. It is a charming destination with a beautiful 16KM stretch of white sandy beach along the Persian Gulf coast. While not as popular as Dubai or Abu Dhabi the Emirate does attract package holiday tourists each year and has spent time developing the area constructing a five star resort and shopping centre.
Umm Al Quwain
The Emirate of Umm Al Quwain is located along the coast of the Arabian Gulf and offers stretches of beaches, an enclosed lagoon and houses a multi-million dirham aqua park, Dreamland. Umm Al Quwain city has also witnessed huge developments over the last number of years including construction of buildings, roads, parks and other amenities.
Ras Al Khaimah
Ras Al Khaimah is located at the north end of the coast of the Arabian Gulf, is one of the seven Emirates that form the UAE. Its beauty is seen in its traditions and scenery, from calm blue seas with clean white beaches stretching over 40KM to dramatic desert dunes and cultural traditions. Ras Al Khaimah is becoming one of the fastest growing tourism destinations in the UAE.
Fujairah
Fujairah lies in the south-eastern corner of the Arabian Peninsula with tourism playing a significant role in the area. The sheer variety and unspoiled beauty of the naturally gifted scenery and coastline make it one of the most desirable tourist destinations.
Practical Information for Buying Property in UAE (Dubai)
Top 10 Tips
1. Summer humidity is very high (up to and even over 40C) so ensure you can cope with this or that your property is suitably air conditioned.
2. Ramadan, the Muslim feast, is strictly observed in most parts of the UAE. Normally starting in September and lasting a month, this will involve serious restrictions on eating, drinking and smoking in public places.
3. There are few restrictions on property ownership for non-nationals in designated areas.
4. Make absolutely certain that the person or persons or company selling you the property is, in fact, the registered owner.
5. Deal only with established agents and developers.
6. Stamp Duty does not apply.
7. The rental market is very strong in the UAE, especially Dubai and 20% plus growth year-on-year is usual.
8. A sales agreement is usually the only paperwork required before registration.
9. Be careful of all potential frauds.
10.You cannot force through the sale of a property if there is a dispute but you can seek damages.
The UAE (Dubai) Property Market
In 2002, the law changed to allow foreigners buy property in Dubai and it has since become one of the hottest markets in the world. Big and ambitious development schemes have attracted the rich and famous but also many average property buyers attracted by the almost year round fine weather.
The Dubai real estate market is particularly strong especially for completed properties. Annual price rises of 7-10% for apartments and villas in the most-favored locations have taken place in recent years. Off-plan sales are not as strong and given the travel distance involved, most European buyers want to see a physically completed property before purchasing. The rental market is very strong and rises of 20% plus on an annual basis are not uncommon.
The Government of the UAE is constantly trying to attract overseas investment so changes are regularly being made to protect foreign ownership and also to introduce greater competition in the local mortgage market.
The UAE remains a strong market for property speculation so much desired properties can see a lot of competition to purchase.
How to Find a Property Agent
There are some agents in Ireland who assist in buying property in the UAE and some developers in the UAE, especially Dubai advertise on the web and in magazines and supplements in Ireland.
You will need to decide on the type of property for which you are looking. Is it a holiday home to be used a few weeks in the year or is it a more permanent residence? A holiday home ideally will require little maintenance.
Give the estate agent / developer a clear understanding of what you seek in a property. Be prepared for the types of property you are viewing i.e. wear appropriate clothing. Take a good local map and have a list of questions prepared.
The Legal Issues
As the law and culture is quite different to Ireland, ensure you use a lawyer with a good knowledge of the UAE legal system and laws.
The Lands Department is the only authority that can register real property rights. For legal reasons, you should always check that this is done properly with your property. Real property rights capable of registration include rights of freehold ownership, long leases of up to 99 years and also collateral rights such as easements, restrictions and mortgages over real property. You must take the contract to the Lands Department and apply for ownership to be registered in their name. If the application is in order, the Lands Department will register the ownership in the Property Register and issue you with a ‘Title Certificate’. This is the document that proves ownership.
Make absolutely certain that the person or persons or company selling you the property is, in fact, the registered owner.
Ownership by Non-UAE Nationals
Legally, all nationalities other than UAE nationals are granted the right to own a freehold interest, a right of use or a long lease of up to 99 years in ‘designated areas’ of Dubai or the UAE as approved by the Ruler.
Long leases, sold in areas which are not designated areas, fall outside the ambit of the law, but nonetheless are not illegal in any way. Such unregistered leases are treated in a different way for some purposes:
- Unregistered leases remain personal rights, not rights in rem or property rights;
- Unregistered leases are still capable of being inherited;
- Disputes arising between a landlord and a tenant of an unregistered long lease will still be adjudicated by the Rents Committee.
The Contract
Because the international property market in Dubai and the UAE is still quite young, there is as yet no formal purchase process. The only piece of paperwork required is a sales agreement. Before signing, make sure to consult a local lawyer or one familiar with the local legal process, as once signed, the document becomes legally binding.
In the majority of cases, those buying freehold property in Dubai do not incur survey fees. Stamp Duty does not exist. The only significant cost, therefore, is a 1.5 per cent land registry fee, payable on completion.
Dealing with Property Disputes
In the case of a property dispute, the law provides that the liability for breaching an undertaking to transfer any Real Property Right shall be limited to payment of indemnity, whether or not such undertaking provides for an indemnity. Therefore if a seller defaults on his obligations under a Sale & Purchase Agreement and fails to transfer the property to the purchaser, the purchaser can claim damages from the seller for his losses suffered, but cannot force the seller to transfer the property to him. In other words, specific performance is not available as a remedy.
Additional Information
Major difficulties can result if a property has been willed to a number of siblings and there is a family dispute as to ownership. Get your legal adviser to ascertain as soon as possible that such difficulties will not arise.
Check to ensure that the property actually matches its legal description. Otherwise you may end up with a property that is actually less than that in the description or which is technically illegal.
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