From an investment point of view, buying property in Dubai is one of the best ways to make your money grow. You can enjoy a high rental yield, and your property will grow more valuable yearly. The best part—all of this income is tax-free. If you have ready funds, buying property in Dubai is as straightforward as purchasing property in India. If not, you can always get help with property financing.

In this blog, learn all about mortgage options and real estate loans. Dubai is, after all, an investor-friendly emirate.

Assessing your Requirements

Before you look into property financing in Dubai, you should have a clear idea of how much your investment will cost you. Property values vary from city to city and project to project. An apartment in a project with swimming pools, a clubhouse, sports facilities, etc., will cost you more than an apartment in a project that does not have these amenities.

The property ticket price is the foundation. You must also account for transfer fees, possible commissions, and maintenance fees. If you need to mortgage the property, mortgage fees may also apply.

Real Estate Loans Dubai

Most people take a loan from the bank to finance their property investments. You don’t need an account with the bank from which you are taking a loan, but you must meet their eligibility criteria. At its essence, this means you should be able to prove that you can repay the loan. You must put down a certain percentage of the property value as a down payment independent of the loan.

There are two key elements you should consider when choosing a loan. Firstly, the interest rate and, secondly, the loan duration. Interest rates for home loans are subject to your credit rating. You and a friend may be eligible for a home loan at different rates depending on who has a better credit score. Most home loans can be paid back in up to 25 years. Some loans also allow advance part-payments to help close the loan faster.

Developer Financing

Some developers do not require a complete upfront payment before handing over the property. If you’re investing in a project still in the planning or construction phase, you can put down a booking amount and make payments at various stages of the construction. Some developers also offer post-handover payment plans. This gives you more time to plan your finances and could reduce the amount you need to take a loan.

Mortgage Options Dubai

Mortgaging your property and taking a loan may sound synonymous, but they are not. Home loans are considered unsecured loans. You don’t have to put down collateral. On the other hand, a mortgage is a loan taken against your property as collateral. As a result, mortgage interest rates are often lower than home loan interest rates. Mortgages also usually have a shorter repayment period. As a non-resident investor, you may find that you can mortgage a lower percentage of your property value than resident investors.

Private Lenders

In addition to the traditional banking system, there are many private lenders you can ‘borrow’ money for property financing in Dubai. Private lenders usually have quicker approval processes and may give you a loan for a higher amount than the banks are willing to. However, their interest rates are generally significantly higher.

Tips to Finance Your Dubai Property Investment

Buying property is one of the oldest, tried and tested ways of securing your future. However, when you dip your feet into the property market, you’ll also come across some not-so-great stories. Here are two important tips to help you make the right investment.

• Do your research: Never buy property based only on someone’s advice. Ensure you have looked into the developer’s reputation and the potential for capital appreciation in the area independently. This is where it is beneficial to work with trustworthy property advisors. After all, given our experience, we have a better understanding of the Dubai property market.
• Know your capability: Everyone wants a luxury waterfront villa. But, rather than put yourself under the stress of paying back a seemingly impossible loan, pick a project better suited to your finances. The rental you get from your first purchase and the capital appreciation may make buying a luxury property more comfortable in a few years.

Getting Ready to Invest in Dubai

From downtown Dubai to Meydan, there are countless investment opportunities in Dubai. At Keymax Real Estate, we’ll make it easier to select the right project, connect you to reliable financiers and guide you through the legal paperwork to make your investment process as smooth as possible. Reach out to know more.