The real estate market in Dubai is known for its luxury and diversity, and the secondary market is no exception. However, for new agents, buyers, and first-time sellers, the process of buying or selling property in the secondary market can be challenging to navigate. This guide is designed to provide a comprehensive understanding of the process and what to expect when buying or selling property in the secondary market in Dubai.
Step 1: Determine Your Budget
Before beginning the process, it's important to figure out what you can afford. Remember that there is a 2% agency fee and a 4% transfer fee to take into account when purchasing a property. If you're planning to mortgage, you will need at least 25% of the property as a down payment. Additionally, you'll be paying interest on your loan, which varies but is typically around 3-4%. It's important to set a budget and work with your agent to make calculations.
Step 2: Get Pre-Approved for Financing (Buyers Only)
For buyers, getting pre-approved for financing is an important step in the process. Being pre-approved not only confirms your budget but also puts you in a stronger buying position. A bank will review your application and issue a letter or an email stating the approved loan amount, which is generally valid for 60 days.
Step 3: Find a Reliable Real Estate Agent
Finding a reliable and experienced real estate agent and company is crucial. An experienced agent can understand your budget, wants, and requirements, and guide you through the process. The more detail you go into at the preliminary stage, the less time it will take to find the right property.
Step 4: Start Viewing Properties (Buyers Only)
Once you have set your budget and found an agent, buyers can start viewing properties. Your agent will highlight communities and properties that match your budget and requirements. Arrange appointments to view several options until you find what you're looking for.
Step 5: Make an Offer (Buyers Only)
When you have found a property that you like, buyers can make an offer. For the strongest chance of acceptance, it's recommended to put your offer in writing, with a copy of a 10% deposit cheque, along with copies of the passport and Emirates ID of all parties who will be on the title deed.
Step 6: Sign the Memorandum of Understanding (MOU)
If the offer is accepted, both buyers and sellers will need to sign the Memorandum of Understanding (MOU). Your agent will draft an MOU, which is also known as a Form F. You'll review the MOU and then both parties will sign the contracts along with handing over the 10% deposit cheque.
Step 7: Sales Progression Process
The sales progression process can vary depending on the bank, but it's important to factor in an average of 6-10 weeks. If the buyer is purchasing with a mortgage, the bank's involvement will be needed, and a bank valuation on the property is required. The buyer will need to obtain the final offer letter from the lender
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