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Immediate Return On Investment |
If a buyer is seeking to realise an immediate profit from their property investment then the way to go would be a resale property. Buyers should however ensure that the transaction goes back through the original developer.
As there is no official conveyancing system in Dubai this precaution helps prevent the investor from falling foul of unscrupulous fraudsters who may not have permission to sell or may have outstanding debts on the property.
Often an investor will sell their property on to a secondary buyer during the construction phase and will make money on any capitol that has accrued. Some development companies will not allow the then owner to sell on until the property has been completed. These issues are subject to constant change and are another good reason for the buyer to contact the original developer before entering into any agreement.
Buying before a property has been completed is perfectly normal in Dubai and the process follows a typical path. In terms of purchasing during the construction phase this is the norm in Dubai currently because the majority of property developments are still to be completed! The process typically follows this path:
- The buyer agrees on a property and puts down a deposit of between £1,000 and £3,000.
- Contracts are drawn up detailing the payment schedule - normally between 10%-20% of the purchase price every 3 months.
- The property can usually be resold before construction is finished with a fee of about 2% going to the developer.
- It can take anywhere from 12-36 months for the property to be completed.
Whilst there isn't an official conveyancing system in place it is wise to secure the services of a lawyer to handle the terms of the contract and to manage finances.