How To Buy Property in Dubai As A Uk National

Choose the Right Broker

Buying property in Dubai as a UK national requires more than just browsing listings on Rightmove. The market features a mix of off-plan and new-build developments, as well as villas and apartments that are relatively new compared to the older housing stock in the UK. Most properties are part of a master development, built within communities owned by a single developer. To navigate this unique market, selecting the right broker is crucial.

You will typically need to work with a property broker or agent to find a suitable home in Dubai. Some areas may restrict sales to foreign nationals, so it's essential to use a broker who understands the local regulations.
Recognizable UK property businesses such as Savills, Knight Frank, and Sotheby’s International Realty have sales offices in Dubai, alongside reputable local firms.

RReal estate agents, brokers, and developers must be licensed by the Real Estate Regulatory Agency (RERA) in Dubai, which oversees the real estate sector. You can verify a broker's license on the Dubai Land Department website to ensure they are regulated and adhere to specific standards.

Chris Whitehead, managing partner at Dubai Sotheby’s International Realty, emphasized the importance of selecting the right brokerage: “Choosing the right brokerage is important as some may be full of salespeople who only sell what is better for them. You need an agent who knows the best location depending on the type of buyer, such as the best places for families or investors.”

Finding a Suitable Dubai Property

Once a property broker understands your requirements, they will invite you to view a shortlist of properties. It's important to research local prices and verify that any developer is legitimate and licensed, especially when buying off-plan—a broker can assist with this.

Despite rising property prices, there are still great investment opportunities available, according to Chris Whitehead.

• Two-bedroom flats Typically start from £300,000 or AED 1.4 million
• Four-bedroom houses Start from £650,000.
• A luxury six-bedroom Home overlooking a championship golf course costs around £2 million.
• A branded, serviced apartment can be priced from £4 million.

Properties in Dubai

Properties in Dubai yield an average 6% return, and all investment income is tax-free. Additionally, there is no stamp duty or inheritance tax, making it an attractive market for investors. When you find a property you like, you can make an offer. If the offer is accepted, the buyer must pay a 10% deposit. This process is more stringent than in the UK, where an accepted offer is not binding until contracts are exchanged. In Dubai, negotiations typically occur before terms are agreed upon, but once the offer is accepted, pulling out of the purchase means the buyer risks losing their deposit.

How to Finance a Dubai Property Purchase

While many property buyers in Dubai are "prime" or super-prime customers who may pay in cash, it is also possible to use a mortgage. Jerry Parks, head of real estate at Taylor Wessing's Dubai branch, notes that using mortgages is becoming more common.

Overseas buyers need to apply for a mortgage through a bank in the UAE, though some banks may have restrictions on lending to non-residents. Obtaining a visa can help secure lower rates if you are working in Dubai. Non-resident mortgage interest rates range from 6.5% to 7%, compared to 4.5% to 5% for UAE residents.

You can apply remotely, but you will typically need to be in Dubai to complete the application and sign documents. The "know your customer" process varies by bank and depends on the applicant's profile and source of wealth. It requires certified documentation proving identity, address, employment, and income.

Parks advises, “We recommend clients use a local mortgage broker, licensed by the Dubai Economy & Tourism authority and regulated by the UAE Central Bank.”

Eligibility for UAE Mortgages

Mitchell Walsh, CEO of Integritas Property Group, outlines eligibility requirements for non-resident home loans in the UAE. Lenders typically check for net earnings of over £3,000 per month after tax, a good credit report, no existing mortgage in the UAE, the borrower being aged between 21 and 64 at the time of application, and a deposit of 40% to 50%.

Documentation requirements vary but usually include a copy of the buyer’s passport, utility bills, six months of personal bank statements, and a credit report.

Conveyancing and Surveys

Many brokers offer their own conveyancing process – although this can be done separately – and there are mixed views over whether to get surveys as many properties are still relatively new and are unlikely to have the same legal or structural issues that can come up in UK transactions.

Mr Parks added: “In recent years we have seen more buyers carrying out surveys on properties prior to purchasing. Previously this was not the norm, with most buyers assuming that as the property was recently built it shouldn’t suffer from any major structural issues. The recent storms have underscored the importance of having a professional survey done before you buy.”

While much has been written recently about the attraction of the Dubai property market to those wishing to launder money or hide funds from government authorities, Mr Parks highlights that law firms must adhere to UAE anti-money laundering procedures.

He said: “These require lawyers to obtain certified proof of ID and address, as well as details regarding source of wealth.

“That information is then analysed and a risk rating applied that may require further information before the lawyers can act. International law firms also run all potential client details against worldwide sanctions data to ensure they don’t accept instructions from those identified on those lists. All law firms liaise closely with the Financial Intelligence Unit at UAE Central Bank, reporting any suspicious activity.”

Completion day

In Dubai, finalizing property deals requires an in-person cheque transfer, unlike the UK's electronic fund transfers. Non-resident buyers can use a UAE bank account or appoint a trusted adviser for financial transactions. UK residents often opt for a power of attorney notarized by Dubai courts, allowing lawyers to handle documentation and represent them during the completion meeting for a secure transaction. It's crucial to carefully choose who you appoint under power of attorney, ensuring your interests are safeguarded throughout the process by engaging a reputable law firm.

The buyer also has to pay fees to the property broker, unlike in the UK where the seller pays estate agency fees. There are set broker charges in Dubai. Buyers typically pay a 2pc agency fee and a 4pc transfer fee. That may sound like a big percentage compared with typical UK estate agency commissions, but remember there is no stamp duty to pay.

Mr Whitehead said the whole process can take around four weeks from making an offer to completion while in the UK it can take closer to four months or more.

He said: “Buying a house in Dubai is as simple as buying a car if you have the right brokerage that looks after you, especially as you could be sending your capital 3,500 miles away from the UK.”