Buying your first home in the UAE can seem daunting, especially if you’re new to the market. When making this big decision that involves a significant amount of money, there are multiple factors involved that go beyond choosing an aesthetic that appeals to you.
To understand this process, we sat down with Nour Al Hadi Al Haddad, the CEO of Alhad Real Estate Broker, to discuss the essentials that every first-time home buyer should know about buying your dream home in Dubai. Hear from the expert himself, as he shares insider advice on budgeting, finding the right location, ROI and more!
Watch the video to find out his take on the topic, or continue reading to explore the highlights:
Breaking Down The Criteria
You can’t really talk about buying a home without thinking about where you plan to live. Each area has its own charm, offering residents unique lifestyles and advantages.
Hadi suggests choosing a location based on budget and your ‘end goal’. For example, if you’re looking for a family home, choosing a community with townhouses and villas having access to schools and community centres may be a good idea. Single professionals can opt for one-bedroom apartments close to the city and activities. On the other hand, investors should look for places that can help them generate a reasonable rate of return.
Location and budgeting go hand in hand. Hadi highlights this difference by comparing the prices of properties in Downtown Dubai versus Dubai Silicon Oasis – the former being a landmark location in the city. When buying an apartment, factors that influence the price include the view (from the unit), the developer’s reputation and the building’s proximity to schools, malls or community centres.
Budgeting And Money Matters
We decided to get into the core of the property-buying process – the budget. On being asked about the additional charges to keep in mind, Hadi shared that there is a 4% DLD fee; plus the Oqood fee for properties purchased from a developer. Depending on the developer, this fee can be between AED 2000 to AED 6000.
He then explained that for the secondary market, additional charges are: a 4% DLD fee, agency fees, and trustee office fees (6.5%). There are also yearly service charges to the management company of the building.
Background Check 101
To the newbies, Hadi explained that ROI, or Return on Investment, is calculated by dividing the annual rent of their property by the purchasing price. A term commonly used when discussing purchasing property, Hadi said that the average ROI today is around 6 per cent – anything above this is considered healthy ROI.
It is best to do your research to understand these terminologies and the processes involved. Hadi stated that your research sources depend on the buyer you are. If you’re looking for a family home, or a home for yourself, he recommends Bayut’s Area Guides and School Guides. These resources, curated by Bayut’s expert editorial team, showcase everything you need to know about your next home, community, or school.
Another resource to find out property prices is the Transaction History tab on Bayut, which has an overview of last-sold property transactions that you can filter based on your location of interest.
Since affordability was the subject on the table, we asked Hadi what the most affordable areas in Dubai were. He said that Dubailand and DAMAC Hills 2 for townhouses and villas, and Dubai Sports City, Motor City, JVC and Town Square are for apartments. Check out our Market Report for a closer look at the affordable properties in Dubai.
Common Mistakes Of First-Time Home Buyers
When we talk about the do’s, we also need to talk about the don’ts, or the most common mistakes first-time home buyers make during this journey. Hadi stressed the importance of getting pre-approval for a loan from a bank before looking for a property – a prerequisite many first-time home buyers forget to do. It is to be noted that this pre-approval expires in two months.
Taking an emotional decision without prior research is also something Hadi said to avoid. Emotions tend to get in the way of making logical decisions, so this advice is something one should keep in mind.
Living in a thriving country like the UAE can definitely inspire you to buy your forever home here. We hope our resources on MyBayut and our guides can be your stepping stone to this fantastic milestone. Stay tuned to MyBayut’s Expert Advice for more tips on buying property in the UAE.
About Nour Al Hadi Al Haddad
Nour Al Hadi Al Haddad is the CEO of Alhad Real Estate Broker. He has over nine years of experience in the UAE real estate market, and strives to provide the most satisfactory service for landlords and clients. By being transparent in his work and offering precise information, he continues to build a strong reputation every day.
About Alhad Real Estate Broker
Alhad Real Estate Broker is a bespoke real estate agency based in Dubai. Their expert team offers guidance to homeowners, tenants and value-seeking investors, owing to their excellent knowledge of the market.
Their team is passionate about their work, and is dedicated to providing the best service for their clientele matching global standards. Alhad Real Estate Brokers also prides on leveraging innovation and technology to assist their clients and ensuring a job well done.