How to buy a property in UAE as an expat?

Nationals of the UAE are allowed to buy real estate in full ownership everywhere in the UAE. This also applies to citizens of some Middle East countries such as Saudi Arabia, Oman, Bahrain, Kuwait, and Qatar.

UAE Golden and Residency Visa for purchasing property

Foreigners from other countries can buy property in the United Arab Emirates under certain conditions. In special areas called freehold zones, it is allowed to purchase property into full ownership. In any other place in the UAE, it is allowed to have only a tenancy over a real estate object.

In the case of a tenancy, a person owns only a physical object for 50—99 years but not the land it is built on.

In the case of full ownership of a property in the freehold zone, foreigners can obtain the UAE Golden Visa. There are 9 freehold zones in Abu Dhabi and around 50 in Dubai.

1. Growth of prices on real estate. The demand for real estate in the UAE is increasing. By the end of 2022, the amount of property sales transactions has reached 25,500, which is 60% more than in the same period of the last year.

Due to that, the prices are also increasing. For example, at the end of 2022, an average off-plan apartment costs AED 1.3 million, which is 15% more than a year ago.

2. An opportunity to rent the object out. Owners have a right to rent their properties out. The rental yield is about 5—8% per year.

Among the people who rent residential properties are tourists, business people, and highly qualified employees who come to work in the country.

3. No taxes on real estate. There are no annual property taxes that real estate owners must pay. Owners also don’t pay taxes on income from renting their properties out.

It is required to only pay taxes upon buying or selling a real estate object. Yet, the rate is pretty low, 2—4%, and the tax amount is usually divided in half between the buyer and the seller.

4. Obtaining a Golden Visa. People who purchase real estate in the freehold zones can participate in the UAE residency program. The visa is given for either 2 or 10 years, depending on the sum of investment into real estate.

With a Golden Visa, investors can open bank accounts for international transactions. At the same time, they are not required to live in the country permanently.

Individual cost calculation for the UAE Golden Visa

Get the cost calculation

Dubai is the most popular district for buying property in the UAE. Foreigners purchase real estate there four times more often than in Abu Dhabi, the country’s capital.

The average price for a square metre in Dubai city centre is higher than in Abu Dhabi: $3,755 versus $3,340, respectively. However, apartments outside the city centre are more expensive in the capital than in Dubai: the average price in Abu Dhabi is $2,947 and in Dubai is $2,380.

Among the Dubai areas where investors purchase properties the most frequently are Business Bay and Dubai Marina. The most expensive apartments are located in Burj Khalifa and Palm Jumeirah areas.

On average, you would need $300,000—600,000 to buy an apartment in Dubai. If you decide to buy a villa, be ready to pay $500,000—1,000,000.

Among the types of properties that foreigners can purchase are apartments, townhouses, villas, and commercial properties. To qualify for a UAE residence visa, a foreigner can choose finished real estate or a property under construction.

Apartments are bought almost 5 times more often than villas: for the 2nd quarter of 2023, the number of purchased apartments reached 23,244, while the number of purchased villas is 4,808, according to the Dubai Real Estate Market Report.

In the UAE, you can purchase a newly-built property or one still under construction from a developer. The other option is to buy a property which had a previous owner. Each type has pros and cons, so the choice depends on your goals and preferences.

A new property is often built in step with modern trends. It might be more space-optimised and energy efficient. The new property can also be bought at different construction stages and offers more options to choose from.

Off-plan properties typically have the lowest price. They require 10—20% payment as an initial cost. The remaining sum is paid after the building is complete. However, the construction might take longer than expected, or the project can be abandoned altogether.

Resale properties may require much money for renovations and repairs. However, you won’t have to wait too long to get ownership and move into.

The secondary market real estate is more tangible. You can see exactly what you’re purchasing, including location, surroundings, amenities, and even neighbours.

If you’re going to apply for a 2-year residence visa, you cannot invest in property under construction — the real estate must be finished. This rule doesn’t apply to a 10-year Golden Visa requiring AED 2,000,000 investment.

The purchased property for a residence or Golden visa can be either new or resale, as this factor is unimportant.

Examples of properties available for investors in the UAE

UAE, Dubai

$2,002,000 — $5,600,000

Apartments and mansions in a new project from the luxury hotel chain The Ritz-Carlton

140 m² — 357 m²

1—3

1—3

UAE, Dubai

$330,000 — $2,255,000

Shared and full ownership of apartments in a premium hotel complex

1—2

1—2

UAE, Dubai

$2,341,000 — $3,785,000

Three-level townhouse with a swimming pool in a luxury residential project

497 m² — 804 m²

4—5

5—6

The list of documents may vary depending on the emirate and circumstances of the property purchase. Here are the documents an investor typically needs to prepare for purchasing property in Dubai:

1. Passport.

2. Current residence visa or permission to reside in the UAE.

3. Sale and purchase agreement, also known as the Memorandum of Understanding or Contract F. This document sets out the terms and conditions for the property purchase.

4. No Objection Certificate from the developer or previous owner if the property is purchased on the secondary market. The certificate confirms there are no outstanding charges, and the transfer of ownership is possible.

5. Power of Attorney if the investor uses an agent or representative to conduct the transaction.

If the investor buys property on a mortgage, they must get pre-approval before signing the sale agreement. The Dubai Land Department requires mortgage approval before applying for the No Objection Certificate.

After all legal procedures are done, the property title deed will be issued in the investor’s name. Since then, they will officially become a property owner in the UAE.

Upon purchasing real estate, the following taxes and fees are paid:

1. Transfer tax: 4% in Dubai and 2% in Abu Dhabi. The tax amount is usually divided in half and paid by both a seller and a buyer.

2. Registration fee: $545 if the deal is less than $137,000 and $1,090 if the deal is more than $137,000;

3. Administration fee for a tax payment — $147.

4. Administration fee for issuing a certificate of ownership — $68.

UAE tax guide

When purchasing commercial properties, buyers pay an additional 5% VAT.

When owning property, no annual tax is charged.

If renting a property out, rental income is not subject to taxation.

Upon selling a property, the seller pays half the transfer tax—for example, 2% of the property value in Dubai or 1% in Abu Dhabi.

Utility bills. The average cost of basic utilities for an 85 m² apartment is $163 per month. The Internet costs around $95—100 a month.

A foreigner who has purchased real estate into full ownership has a right to obtain the UAE Golden Visa. It is granted for 2 or 10 years, depending on the cost of the property.

How to get the UAE Golden Visa

To get a 10-years Golden Visa, the investor needs to purchase real estate for at least AED 2,000,000, or about $545,000. In this case, the investment sum doesn’t depend on the composition of the investor’s family.

To get a 2-year residence visa, investors must buy real estate for AED 750,000, or around $204,000. This sum applies if the investor owns a property alone. If the ownership is registered for two spouses, the real estate must cost at least AED 1,000,000, or around $272,000.

The investor can take a loan to purchase real estate, and the down payment must be at least 50%.

The process of obtaining the Golden Visa takes from 2 months and consists of 5 steps.

1. The preliminary Due Diligence. Immigrant Invest lawyers check the investor and their family members against different international databases. This procedure is required to reveal the risks of refusal and increase the chances of getting a visa.

2. Preparation of documents and getting a 6-month visa. The lawyers provide the investor with a list of required documents. Then they translate and notarise them and conduct consular legalisation. After that, the investor gets an entry 6-month visa.

3. Purchasing of real estate. The investor is not required to come to the UAE to buy a property: we can help do it remotely.

4. A medical checkup. As the investor and their family members who participate in the UAE Golden Visa program are required to have no serious illnesses, they need to undergo a medical checkup. The applicants are tested for dangerous infectious diseases and pass fluorography.

5. The main Due Diligence. The applicants come to the UAE to apply for a visa and give biometrics. The process of considering the application takes 5—7 days. When it is approved, the investor and their family members get visas.

Affordability. The first thing to consider is whether you can afford real estate. Keep in mind not only the property price but maintenance costs, administrative fees and taxes as well, which can reach 7—8% of the purchase price.

Rental yields. Rental yields in the UAE are about 5—8% per year. If you plan to rent your real estate out, make sure the rental income covers your mortgage and maintenance expenses.

Staying period. Before investing in real estate in the UAE, it is worth considering whether you would like to connect your life with the UAE for a long time. Sometimes, renting a property may be more profitable than buying your own.

Trends and market conditions. Exploring current trends and learning how the property market will change is a good idea. Maybe new objects will be built soon, or prices in some areas will decline. The more you know about the market conditions, the higher your chance of getting the best deal.

Location. Consider the lifestyle of your family and what facilities you need nearby. Maybe you need kindergartens or schools, or cafes and restaurants are essential to you. Make sure you choose the best option for your needs.

Quality. Check the age of the property you’re investing in and whether it requires renovations. Also, make sure that the developer building your real estate has a good reputation.

Eligibility for a residence visa. If you plan to get a residence permit in the Emirates, make sure the property you are going to buy meets the requirements. The minimum investment amount is AED 750,000 ($204,000).

Immigrant Invest is a licensed agent for government programs in the European Union and the Caribbean.