How to Buy Property in Dubai Without Overspending

How to Buy Property in Dubai Without Overspending

Have you ever imagined buying your own home in Dubai? Why not? Dubai provides world-class luxuries, modern architecture, and an unbeatable lifestyle. But before getting your hands on buying property in Dubai, it is important to know how to manage your budget. This is essential when making property-buying decisions – it’s very easy to get caught in the limelight of beautiful properties in Dubai and completely forget about your financials.

So how can you buy a property in Dubai – your dream home – without overspending? Carefully planning your expenses well ahead and knowing in advance all the expenses will help you avoid unnecessary financial stress. In this blog with GLLIT, we will walk you through the tips and tricks for clever budgeting and reveal all the secret fees that might be of concern in the property-buying process. 



Understanding the Full Cost of Buying Property in Dubai:

When planning to buy property in Dubai, knowing the asking price is just the tip of the iceberg when it comes to the overall cost. To prepare yourself accordingly, you must be aware of all the other costs involved. Here are the important costs or fees you should know about:

  • Advance Payment: You will need to pay a minimum of 20-25% of the property value as a down payment. Paying a bigger amount as advance payment will help improve your mortgage terms.
  • Mortgage Fee: You pay a processing fee to the bank when buying property in Dubai, and this is usually about 1% of the loan value. This is non-negotiable, so make sure to factor it into your budget.
  • Registration and Transfer Charges: The Dubai Land Department (DLD) charges a 4% transfer fee on the property value, which is non-negotiable. This is a costly charge when you buy a property in Dubai, so plan for it beforehand.
  • Broker Commission: If you hire a broker to assist you in buying property in Dubai, be prepared to pay a 2% commission on the value of the property. It is a vital expense but can be negotiated.
  • Upkeep and Service Charges: These charges depend on property type, but when you buy property in Dubai, you have to be aware of the maintenance costs and service charges that can accumulate in the long run.
  • Hidden Expenses: Do not forget the hidden expenses when buying property in Dubai. These include utility connections, relocation costs, home insurance, and potential repairs or upgrades.

Tips for Smart Budgeting when you are buying property in Dubai

As you now have a better understanding of the costs involved in the process of buying property in Dubai, here are some more smart ways to budget your finances: 

  • Set a Realistic Budget: Before you start to look for properties in Dubai, try to find an affordable property in Dubai and make a note of your finances. Decide how much you can afford to spend on buying a property in Dubai without compromising on your lifestyle. Make sure to stick to this budget to avoid the risk of digging a hole in your pocket.
  • Compare Mortgage Offers: Banks offer different rates on interest and have different loan terms. Take your time to compare interest rates from the banks to help you choose the best mortgage deal. 
  • Negotiation on Fees: Some fees, like agent or broker fees, transfer fees, or maintenance fees, may be negotiable. Never hesitate to ask for a better deal when buying a property in Dubai.
  • Long-Term Plan: Budget is not just a one-time thing when buying property in Dubai. After a successful purchase, there may be some surprise expenses like maintenance, repairs, and potential improvements, so always be prepared for them.

Tips to Avoid Common Mistakes When You Buy a Property in Dubai

Most first-time homebuyers make the mistake of underestimating the additional and hidden home-buying costs when buying a property in Dubai. To avoid this situation, make a list of all possible expenditures beforehand and add a 10-15% emergency fund to your list. This buffer will help you cover all hidden and unexpected charges occurring at any stage of this process. 

Final Thoughts

The complete experience of buying property in Dubai is exciting but can also be overwhelming if you are not able to budget it correctly. From the initial deposits to any hidden charges, it’s important to have a clear picture of all the expenses involved in the process of buying a property in Dubai. By carefully planning your budget, comparing bank rates, and negotiating fees, you can easily avoid overspending and ensure that you can buy your dream home within your financial limits. If you are ready to decide on buying a property in Dubai, GLLIT is here to offer you expert advice, guidance, and support in every step of the home-buying process. Reach out to us today to find your dream home at the price that fits your budget.

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