What are five questions to ask before I buy a property in Dubai?
1. What are prices for properties in the area ranging from?
This question allows you to instantly differentiate between an area specialist and a non-area specialist. Brokers who are not familiar with the area, will not be able to give you a precise answer, their lack of knowledge will lead to poor negotiating and potentially result in the buyer overpaying. Therefore, it is important to work with an area specialist for the best advice and guidance.
2. Why is the owner selling and how long have they lived there?
This question will give you a hint of the owner's circumstances. While you may not always get a truthful answer, it can still be helpful. In some cases you might have a distressed seller, who wants to sell the house quickly or there might be something wrong with the property. Depending on the situation it can allow room for negotiation, which can be used to the buyers advantage.
3. How long has the property been on the market?
It’s always good to know how long a property has been available on the market. If a property has been on the market for a long time, this indicates it was priced too high to begin with and is often a function of a poor strategy. This will give the buyer more room to negotiate as the seller may be more motivated and willing to compromise on the price.
4. What are the service charges for the property?
Buyers often forget to ask about the service charges for the property. Building service charges across Dubai will vary from a few thousand dirhams a year to up to 100K, which can make a massive difference on yearly costs and needs to be incorporated in initial cost calculations.
5. Has there been any work to the property, such as upgrades or extensions?
This is a vital question as some developers will physically come to the property and do an inspection as part of the No Objection Certificate (NOC) process. If there are any modifications or more likely extensions on the property the developer will require the seller to have the relevant NOC to allow them to give the NOC for the transfer of ownership of the property. It's important the buyer asks the agent if the seller has NOC's in place for these, if not the seller may have to take the extension down or pay for the NOC cost after the deal is agreed which ultimately can make a deal fall through.
What are the hidden costs if I buy a property?
There are several costs that clients are required to pay apart from the purchasing price, however we wouldn’t call these hidden costs, as these are discussed during the process of buying the property. Usually, these fees can total to around seven per cent of the total property value. Therefore, they should not be overlooked but incorporated into the costs of buying a property.
Some of these are but are not limited to:
• Transfer fees, four per cent of the purchase price
• DLD appointment fee of Dh4,200 and Dh580 admin fee
• Professional/ Agency fee of two per cent plus Vat and Conveyancing Fees
• And other additional fees depending on if you are purchasing with finance, these will be stipulated in the contract.
Connor Manning is Dubai Hills area manager at Betterhomes while Scott McGeachy is branch manager at Betterhomes
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