Selling off-plan property in Dubai (Procedure)

One of the foremost reasons why investors choose to buy off-plan property is due to the kind of profits it can bring even before the project is complete. Here’s a useful guide that can help you sell off-plan property.

Resale restrictions

Developers have certain resale restrictions in place for off-plan projects in Dubai, wherein you are only allowed to sell the property upon payment of a specific percentage of the purchase price.

The requirement is 30-40% of the property value, depending on the depending on your Sales and Purchase Agreement with the property developer.

According to the terms of the contract, this percentage can run even higher.

  • Once you find a buyer, then you need to secure a No Objection Certificate (NOC) from the developer
  • This costs 5,000 AED and is paid by the buyer
  • The agent and the buyer will proceed to the trustee office
  • From there, you will be able to get the selling price of your shares in the property by way of a manager’s cheque from the buyer
  • For the transfer fees, the cost will also be paid by the buyer
  • Properties priced over AED 500,000 will incur a fee of AED 5,000
  • For properties with a value of below 500,000, the transfer fee is AED 3,500
  • Registration fees will amount up to 4% of the total property value

Selling your property is an important decision and there are several factors that must be considered to ensure that you get the best value for your property and to achieve a swift sale.

  • Choose a specialist broker for your home area are and check what their transactional record is like
  • Understand the kind of marketing strategies they implement and how suitable it might be for selling your property
  • You need to make sure that your home is listed with an organisation and a broker that can present it in the very best light across multiple marketing channels, both digital and otherwise, to generate the maximum number of viewings which will result in a smooth transaction

How to find the right price?

The market leads transactional activity and a good real estate broker will accurately appraise your home based on transactional data related to your neighbourhood and the type of property you have.

That being said, market data does not always recognise the capital value of the work that you have done to your home. Thus it is important to look into the recommendations of your real estate broker as you don't want to price yourself out of the market.

  • Always ensure that the paperwork is complete and accurate from the time of the listing
  • Any issues with the documentation that might prevent you from selling your home
  • There needs to be a comprehensive file of transactional paperwork for the property so that when an offer is received, the sale can proceed quickly
  • Your broker should also have all relevant documents in hand, and he or she should give you a clear indication of the fees involved in listing and selling your home

Once your home is on the market, the realisation marketing period (the marketing period before the home sells) in Dubai can differ from 2 weeks to 3 months plus.

Tenancy and rental laws in Dubai for applicable for commercial buildings and residential apartments and villas in Deira, Bur Dubai and freehold areas.

RERA - Real Estate Regulatory Authority which is part of the Dubai Land Department is a government agency which licenses real estate agents, brokers and developers and regulates all real estate activities in Dubai.

With effect from 14 March 2010, all rent and lease contracts for properties in Dubai must be registered online at RERA's new Ejari portal. From March 2017, a standard tenancy contract for Dubai rentals is available for download from the Ejari website: https://ejari.gov.ae/PublicPages/TenancyCertificate/PrintTC.aspx

Post-completion of the registration process, the attestation consists of 3 parts:

  • Ejari tenancy contract
  • Ejari registration certificate
  • Ejari fees payment receipt
  • Whilst there is a federal law underpinning real estate transaction in the UAE, at present it has been left to the discretion of the individual emirate to decide upon its own framework and proposition to the market
  • When looking for agents to work with in the UAE or your home country, ask for the company’s registration number with RERA
  • Cancellation of the tenancy contract is based on the terms and conditions outlined in the leasing addendum and defined in the RERA regulations, signed by the landlord and the tenant at the time of leasing
  • When you are transferring to from your old apartment to your new apartment , keep in mind expenses such as set - up fees such as the house - shifting service , community fees , phone and internet transfer fees , gas set - up fees
  • With thousands of expats moving to Dubai and building new lives here, the vibrant city is positively bursting with residential properties to accommodate its growing population
  • Tenancy contracts in Dubai are usually on an annual basis, so spend some time weighing all your options and make an offer when you have done your research on the unit, the building and the area
  • Always ask your agent 's broker (RERA) number to be certain and to avoid issues in the future
  • Click plenty of pictures of the vacant property in order to claim the security deposit amount in full at the end of your tenancy contract. Ask for a receipt once you make the security deposit payment
  • Register with DEWA to activate water and electricity in your new apartment or villa in Dubai
  • If your landlord decides to increase your rent, you must be given 90 days’ notice and the new rent must be based on the rental index published every quarter by RERA
  • In order to calculate your rental increase, you can check the rental increase calculator provided by Dubai Lands Department: https://www.dubailand.gov.ae/English/Pages/rental-increase-calculator.aspx
  • Experts strongly urge tenants who most often skip this part of the rental process, to go over the agreement in detail to avoid surprises at a later stage
  • One really important difference in the rental market in Dubai, which takes many newcomers by surprise, is that it’s fairly common for landlords to ask for significant amounts of the annual rent upfront
  • If paying your rent upfront , or split across a small number of payments over the year is a problem, then get an agent who can help you find landlords who can work on a monthly payment system
  • If things like the phone, electricity and water bills will be paid by the tenant then your landlord should be able to give you an idea of the average costs before you sign the contract
  • According to new regulations passed by Dubai government, the process of subletting a property on short term basis or as a holiday home has become very easy
  • For example; if you are able to do it the right way, you can make more rental income from your property as compared to renting it out on annual basis
  • Since you are going to be using your property as holiday home, a tourism Dirham of AED 10 or AED 15 will be charged per bedroom
  • Owners and Landlords tend to offer a reduction in rent if this is paid up front on a yearly basis on the other hand it may be more convenient for you to pay monthly this we will help you discuss with the Owners and Landlords in advance
  • Upon completion of the above, an agency fee will be paid (fee depends on the real estate company) along with the AED 500 for DEWA activation and Ejari registration service fee
  • It is advisable to check your documentation if you are in a property for a few years as the properties could have been rented with Sales and Purchase Agreements