Questions about buying real estate in Dubai

    Yes, as a foreigner you are allowed to buy and own real estate in defined areas. There are a total of 23 areas which are called 'Freehold'. The most popular freehold areas are Dubai Marina, JBR, Palm Jumeirah and Downtown Dubai.

    Climate, economy, change of residence, investment, holiday home - there are countless reasons.

    Basically, the same rules apply when buying a property as in Europe. The location as well as the quality of the development and the infrastructure are at the top of the list of criteria for a valuation. In Dubai, the reputation of the developer (Emaar, Nakheel, etc.) is additionally decisive, as the developer remains responsible for the maintenance of the surroundings as well as the infrastructure.

    BR stands for Bedroom and the number in front of it stands for the number of bedrooms. If the ad now says 1BR, this means that the apartment has one bedroom including bathroom, as well as a living room, a (living) kitchen and usually also a guest toilet. Living room and (kitchen) therefore always belong as standard to an apartment or villa and the property designation indicates the number of additional rooms.

    The simplest benchmark is the price per square metre of living space. Prices per square metre for luxury properties in Dubai are around CHF 6,500, while prices in Switzerland are well over CHF 12,000. This has to do with the low level of interest rates and the associated price trend over the past 15 years.

    The largest real estate portals in Dubai are Propertyfinder and Bayut. There, all offers and advertisements for sale as well as for rent can be found. Unfortunately, the quality of the ads often leaves much to be desired. It is also the case that many properties are advertised more than once, as there is often no exclusivity between the real estate agents and the owners.

    When transferring ownership, the name of the buyer is officially entered and registered with the DLD (Dubai Land Department) as the owner. Thereby one receives the Title Deed (owner certificate) and is accordingly legally secured. The transfer of ownership is carried out by a registration trustee, which is similar to our notary's office.

    An ordinary real estate purchase usually takes about one month. We usually calculate with two to three days for the inspections and afterwards for the transfer with another two to three days on site in Dubai.

    Basically, there is the possibility to finance real estate through a mortgage from a local bank. Mortgages are available for residents or expats as well as for foreigners, but are rather expensive by Swiss or German standards. Far more attractive financing options are offered by developers of new construction projects (off-plan with long-term, interest-free payment plans).

    We always recommend our clients to consider financing from Switzerland or Germany. Often, financing can be obtained here at a favorable rate by increasing an existing mortgage.

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    With the ownership of a property one is basically obliged to pay 'Service Charges'. The Service Charges are maintenance costs (additional costs), which are incurred outside the apartment in the building (cleaning, security, reception, etc.). The costs are calculated based on the size of the apartment and must be paid annually to the owners' association (Master Developer).

    Electricity and water are paid separately according to expenditure or consumption, as in Europe.

    Here you can find our service for vacation apartments.

    Yes - we recommend everyone who buys a property in Dubai to open a local bank account. Opening a bank account is possible even as a non-resident, but it is very difficult and tedious. Opening a bank account as a non-resident requires a lot of patience. However, having a bank account makes it much easier to buy a property and maintain it.

    There are no restrictions regarding money transfers. This means that it is also possible to carry out larger transactions.

    Although difficult for a European to imagine - yes, it is possible to buy a property with cash, but this happens very rarely nowadays. Usually, the transaction is completed with a manager's check issued by the bank. This is a promise to pay issued by the bank. This means the bank guarantees that the cheque is covered.

    Emaar as well as also design-focused boutique developer Ellington Properties have been accepting payments for their residential projects through leading crypto broker provider Bitcoin Suisse AG, a regulated financial intermediary based in Switzerland, since mid-2019.

    Both variants have advantages and disadvantages. The main criterion for deciding here is clearly on the timeline. Do I want to move into my property immediately or do I have a little more time and patience and can wait for completion.

    When buying an existing property, there are significantly fewer risks. You buy what you see.

    The advantages of buying a new construction project are certainly that the prices are somewhat lower. In addition, one often has a larger selection and the apartments as well as the interior fittings are new. In addition, the administrative burden is also lower when buying a new construction project.

    The biggest risks when buying a new building project are clearly construction delays and the problem that the environmental work is often not yet fully completed when the property is handed over.

    A legal entity can also own a property in Dubai. This requires a local freezone/offshore company.

    Find out more about company formations here.

    We expect 7% additional costs when buying a property. These consist of 4% Dubai Land Department registration fees, and another 3% brokerage fees. An additional fee of AED 4,200 will be charged for the transfer at the notary's office.

    To ensure a smooth real estate transaction, we definitely recommend hiring a broker or service provider. It is virtually impossible to manage and plan everything from Switzerland or Germany. It is also a challenge to assess the market and keep up to date - even for a local real estate professional.

    Real estate prices went through ups and downs. In concrete terms, this means that there are upward and downward swings, but these have been adjusted by the market over the years. The global financial crisis in 2008 and 2009 corrected real estate prices significantly downward. In the following years, the real estate market recovered and reached a new all-time high in 2014. Since 2014, prices have slowly declined and have been at a four-year low since 2020. In 2021, prices were able to recover strongly. Further price stabilization is also expected in 2022.

    For more on the latest news and trends in Dubai, click here.

    With a tourist visa you are entitled to stay 90 days per year in the country. In case of several visits, the days are added up. The entry and exit is simple and uncomplicated.

    Those in possession of a residence visa must enter the United Arab Emirates at least every six months. Only with the Golden Visa is this requirement waived.

    If you own a property worth at least AED 750,000, you are eligible to apply for an investor visa for a period of two years. If you own a property worth more than AED 2 million, you are even eligible to apply for a 10-year visa.

    More information can be found here.

    Individuals living in Dubai do not pay income or wealth taxes. There is also no property gains tax. Only the value added tax exists. This was introduced nationwide as of 01.01.2018.

    Legal entities that make an annual profit over AED 375,000 must pay tax on this at a rate of 9%. The corporate tax was introduced as of 01.06.2023. Freezone companies are exempt from this tax.

    More information about taxes in Dubai

    Switzerland: Real estate abroad must be declared in the country of residence. The property is listed in the assets or in the assets.

    Further information (Vermö

    Switzerland: Accrued rental income does not have to be taxed in the country of residence. Rental income is only used to determine the tax rate, but is not taxed.

    When renting out a property, we distinguish between long-term and short-term rentals. As soon as a property is rented for more than six months, it is a long-term rental. Tenants usually pay the rent in advance in 1-4 installments per year. For long term rentals, we take over the task of management including check management on site. For short-term rentals, AirBnb or specialized management services are available.

    More information about our management services can be found here.

    As a rule, you can expect net rental yields of up to 7%. One- and two-bedroom apartments generate the highest yields and are easy to let.

    The currency of the United Arab Emirates is the dirham. The dirham is pegged to the US dollar and parallels the US dollar in terms of security or inflation.

    Reselling a property is quick and easy. The real estate market is very liquid and therefore transparent. Nevertheless, it is an advantage to prepare the sale seriously and to choose a favorable time of the sale.

    Switzerland has a very good and close relationship with the United Arab Emirates. There has also been a double taxation agreement with the United Arab Emirates since 06.10.2011.

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    Germany and the United Arab Emirates maintain intensive diplomatic relations. The Strategic Partnership agreed in April 2004 is an expression of this and was further strengthened by the Memorandum of Understanding signed in June 2019.

    Further information

    Dubai is known for safeguarding and protecting foreign investors. The laws and rules are continuously updated, followed and most importantly enforced. If a loophole is discovered in the legal system, it is quickly rectified and the new rules come into effect with immediate effect. The law can be enforced through due process of law.

    As a rule, we start the cooperation with an initial meeting in Dubai or Zurich. It is crucial for us to know the wishes and needs of the customer in detail. In addition, we then discuss the further procedure.

    Here you can contact us