It’s true that the real estate industry, like any other, has its share of both challenges and rewards. Real estate investment is like a gamble. If you make the right choice at the right time, you can win millions, but if you take the wrong step, you can lose everything. As a result, a great deal of thought and research must go into the procedure as a whole.
When it comes to the best off-plan projects in Dubai, the price tag is the one selling point that makes sense. However, greater dangers accompany lower interest rates. No matter how much experience a buyer has, they are still susceptible to making some of the worst possible decisions. However, investors may reap rewards from owning off-plan property Dubai.
In this post, we’ll go through the various legal considerations that should be on your radar if you’re thinking about purchasing the best off-plan projects in Dubai.
The Necessary Paperwork
All applicants must provide the following documents of identification to the developer and the Dubai Land Department:
(1) A copy of the Passport
(2) A copy of the visa information page (If applicable)
(3) A copy of Emirates ID (If applicable)
Often a copy of the Passport is all that is required to get a reservation.
Developers will prepare a reservation form after they have received the required identity documents. Your all personal information and a rough estimate of your payment schedule will be included on this reservation form.
Once the reservation form is filled out, both you and the developer will need to sign it. On the other hand, when the developer hands you the reservation form, check to see if they’ve included their official stamp.
Sale and Purchase Agreement (SPA)
When purchasing the best off-plan project in Dubai, the sales and purchase agreement(SPA) is the single most important piece of paper you will sign. As a result, before making any payments or completing the reservation form, it is strongly advised to take a draft of the SPA from the developer. Please read all Terms & Conditions carefully.
A sales and purchase agreement is often quite basic and is always accepted by the legal staff in the Dubai Land Department. In any case, before signing and paying, feel free to bring concerns you have about the SPA’s terms and conditions with the developer.
The assistance and direction you need with the sales and purchase agreement can be provided by your real estate expert.
Upon completion of the necessary paperwork, the prospective property can be reserved. Typically, a down payment or booking deposit is required from buyers. The reservation fee will be paid under the terms of payment previously established between you and the developer.
The developer is legally obligated to set up an escrow account for you to use to deposit the payments. You can verify the escrow account details with the Dubai Land Department online site.
By the Dubai Land Department’s terms and conditions, developers and investors are required to register the off-plan property immediately following the reservation. The Manager’s Cheque should be written out to the Dubai Land Department for the 4% registration fee.
People who want to invest in off-plan or properties on sale in Dubai but don’t have access to UAE banks can have ideas from the developer to discuss other options. Several developers take care of remitting the registration cost to the Dubai Land Department on behalf of their buyers.
VAT, or Value-Added Tax (Applicable to Commercial Property)
The United Arab Emirates has implemented a 5% VAT from 2018. The value-added tax is the responsibility of the buyer for commercial transactions. As a result, you’ll need to budget an extra five percent for VAT if you want to buy a commercial property from the developer.
No broker’s fee is required if you purchase a home or other real estate straight from the developer. There will be a brokerage commission only if you hire a consultant to find the best deal and handle all of the discussions and interactions with the developer on your behalf.
You and the advisor have mutually agreed upon a brokerage commission. This commission is typically 2% of the buying price in Dubai’s property market.
A title deed is issued to the buyer of a “ready to sell” Dubai property (ownership certificate). However, if you buy a property that is off-plan, you will not receive the title deed until the property is complete. In this context, the government issues Oqood or Pre-Registration Certificates, which are distinct forms of ownership documentation.
As soon as the transaction is completed, the developer will submit the necessary paperwork to the Dubai Land Department to have this certificate issued in your name and they will notify you via email as soon as it is ready.
Project Completion Date
If the SPA specifies a completion date for the project, the developer must meet that deadline to receive payment. Once work is finished, the developer must notify all customers that the project is complete.
Inspection & Handover
Assuming you’ve made the required handover payment, the developer’s handover team will contact you to schedule a time for you to inspect the property. Hiring a Professional Snagging team to carry out this task will yield enormous benefits in terms of the unit’s quality and condition for later use. You can hire Property Shoma for the best Off-Plan Properties in Dubai.
In short, as an investor, you need to know your stuff when it comes to the neighbourhood, the developer, the structure, and the real estate market. This is the only way to steer clear of the choppy waters while also making an informed and intelligent choice.