Can Foreigners Buy Properties in Dubai?
Dubai being one of the most economically viable and infrastructurally developed cities in the world captures the attention of people not only from the Middle East but from around the globe. Whether due to its booming real estate market, the countless job opportunities, or the lavish lifestyle that the city offers, every year, thousands and thousands of global citizens look out for residential spaces to buy for occupying or renting in this urban hub.
But can foreigners buy property in Dubai? How easy or difficult it is for foreign nationals to buy a property in Dubai? What kind of properties can they buy? Where can foreigners buy property in Dubai? What are the steps that they need to follow to ensure they are on the right side of the law while buying a property in Dubai as a foreign national?
We uncover the answers to all these and more in this one-stop guide about buying properties in Dubai as a foreigner or non-resident.
Please note that the term foreigner doesn't only apply to non-residents. It also refers to the expats who are living in the UAE. In addition, there is no age limit to buying a property in Dubai as a foreigner.
Types of Properties that Foreigners Can Buy in Dubai
Foreign ownership is allowed in specific areas in Dubai that are marked as freehold. Irrespective of whether you are a non-resident or an expat, you can obtain ownership rights on freehold properties without any restrictions and on leasehold properties for 99 years.
Freehold Properties
Article 3 of Regulation No. 3 of 2006 Determining Areas for Ownership by Non-Nationals of Real Property in the Emirate of Dubai states the designated freehold land plots available for purchase by foreigners. The title deeds are issued by the Dubai Land Department (DLD). Updated annually, some of these popular freehold property areas are Emirates Hills, Al Quoz Industrial Area, Mirdif, Al Barsha South, Al Jaddaf, Palm Jebel Ali, Palm Jumeirah, Dubai Marina, and Ras Al Khor, among others.
Leasehold Properties
For leasehold properties, the owners cannot make any changes or remodel the property without the consent of the freeholder. You can buy the right to benefit from this property for a long-term period, usually applicable for 99 years.
Tax Imposition on Foreigners Who Buy Property in Dubai
With the intention to encourage foreign investments in the UAE and foster better relationships with foreign nations, the Government of the UAE has established a no-tax concept in its taxation system.
This means that there will be no taxes on the rental income of properties that are purchased by foreign citizens. This helps in nurturing a healthy investment environment and has contributed to more investors from foreign nations showcasing interest in investment in Dubai real estate.
However, there is a one-time property transfer fee that a foreigner needs to pay while buying a property in Dubai. Imposed by the DLD, it is calculated at 4% of the purchased price and must be paid before the ownership of the property is transferred.
Benefits for Foreigners to Buy a Property in Dubai
Buying property in Dubai as a foreigner provides a variety of benefits. Some of the major ones among them are as follows.
Facilitator of Modern Lifestyle
If you want to experience a modern lifestyle in a chic environment, Dubai has to be on your priority list, owing to the numerous infrastructure developments that this city has experienced in the past several decades.
With modern architecture facilitating an urban lifestyle of par excellence, Dubai is the ultimate place to indulge in a luxurious life. Top-notch property developers in Dubai are developing one after another luxury developments of awe-inspiring demeanor. The countless job opportunities, developed technology, and scenic architecture make this a safe haven and paradise for foreign nationals.
High Rental Yields
Due to the high demand for real estate projects in the city, residential living spaces as well as commercial units are always in high demand. This results in high rental yields on investments and as a foreigner you can monetize your investment to an exponential degree in Dubai.
Whether it's a villa, an apartment, or anything in between, the Return on Investment (ROI) on Dubai properties is always high and profitable.
Long-term Residency Visa
Foreign nationals can acquire long-term residency visas by investing in a worthwhile property in Dubai. The highly-appreciated Golden Visa allows foreign nationals to get eligibility for a 10-year residence visa on investing in properties worth at least AED 2 million.
Furthermore, a retirement program for expats has also been launched in Dubai by Dubai Tourism in collaboration with the General Directorate for Residency and Foreign Affairs (GDRFA). This grants expats above the age of 55 years to get a residency visa valid for 5 years if they invest in a property worth at least AED 1 million.
Investor-friendly Taxation System
As stated earlier, the investor-friendly taxation system introduced by the Government of the UAE ensures that foreigners don't have to pay any tax on the rental income from the properties they purchase. This heightens the returns on their property and nurtures a healthy environment for investment.
Apart from the ownership transfer fee to be paid to the DLD, foreigners don’t have to worry about burning a hole in their pockets through any other taxes.
Comprehensive Property Management Services
Property management companies help foreign nationals maintain their properties and handle the legalities through their comprehensive property management services.
From finding tenants to collecting rents, from handling maintenance to providing financial updates and reports, foreign investors can oversee their investments in Dubai with the help of these property management companies which makes investing here safe and reliable.
Granting of Home Loans for Foreigners
There are provisions for a mortgage in Dubai that a foreigner can apply for to buy a property. Various national and private banks across Dubai provide loans to foreigners. Although the rules for obtaining such loans have distinctive characteristics depending on the country of residence and monthly income of the applicant.
As long as the foreign applicant meets the requirements and provides the necessary documents, they can get a home loan for buying a property in Dubai. Foreigners get several benefits through such loans such as low interest rates, high loan amounts, and flexible tenure, that makes investing in buying a property in Dubai easier for them.
In general, a valid passport and bank statement are sufficient documents to apply for home loans but in certain cases, you might have to provide tax returns, salary certificates, trade licenses, audited financial statements, and details of existing loans.
Residence Visa for Foreigners
Foreign citizens are eligible for a Golden Visa that lasts for 10 years if they invest in a property or properties worth at least AED 2 million in the UAE. You can renew it after the completion of the 10-year tenure.
This Golden Visa features a number of benefits for its holders. From a long-term residency tenure to the inclusion of family members, from the non-requirement of local sponsors to a no-tax policy on personal income, exemption from employment restrictions, and access to premium health care, the Golden Visa acts as a boon for foreign nationals.
There is also a 2-year residency visa for purchasing real estate worth AED 750,000 in the UAE.
Steps to Follow to Buy a Property in Dubai for Foreigners?
In order to make sure that you are on the right side of the law, you should always maintain a linear approach while buying a property in Dubai as a foreign national. Although some of these steps might alter depending on whether you are purchasing a new property or a resale unit, the general steps you need to maintain are as follows.
- The first order of business is to select a trusted and authorized developer that is approved by the DLD.
- The next process is finding a registered real estate agent approved by the Real Estate Regulatory Agency (RERA).
- Follow this up by securing a loan if you need it.
- Apply for a No-Objection Certificate (NOC).
- Finalize the registration of the property under your name at DLD.
Conclusion
Buying a property for foreigners in Dubai is now easier and more lucrative than ever before thanks to the initiative taken by the Government of the UAE. As long as you are fulfilling the legal requirements, you can invest in freehold and leasehold properties and derive numerous benefits from them, the primary among them being holding a long-term residency visa.
Investing in real estate in Dubai is a favorable and beneficial option. So research and live your dream of investing in a luxurious property in this majestic city and indulge in a lavish lifestyle.