Home   »   Living   »   Property   »   Expat havens

Expat havens


So you’ve decided it might make sense to buy your own property in Abu Dhabi? Before you open your chequebook, get to grips with the essentials

Buying in your home country is stressful enough; buying property in Abu Dhabi, with different laws and different procedures, needs an extra level of care and attention. We ask Alan Kaye, senior property consultant at District Real Estate, for some advice.

Q. There are restrictions on where expats can buy property in Abu Dhabi …

Expats can purchase property on Saadiyat, Al Reem Island, Al Raha Beach, Al Reef and Hydra Village. They can also buy in Al Ghadeer, still within Abu Dhabi emirate but right on the border with Dubai.

Q. But an expat cannot buy a freehold in these areas?

No, it is not possible to purchase a freehold, which would mean you have absolute ownership of the property and the land on which it stands. You can only buy a 99-year lease, which in theory means the developer or other owner gets the property back after that period.

This is acceptable to all finance houses and there are numerous mortgage products available with terms up to a maximum of 25 years. Of course terms may vary; if your agreement is 10 years, say, then you have to pay it off in 10 years.

Your age is another consideration. Mortgages can only be taken up to the age of 70. So if you took out a mortgage at the age of 55, you would only be able to get a 15-year mortgage.

Q. What’s the procedure when buying a property?

The first step is to ensure that you have the down payment. For properties that cost less than AED 5 million, a minimum of 25 per cent of the selling price is required. For those over AED 5 million, it’s 35 per cent.

When you have found a property and paid the deposit, a memorandum of understanding (MOU) is drawn up between the respective parties. This specifies the timeframe, ownership details and anything else pertinent to the sale and purchase.

A good broker will check ownership with the municipality, liaise with respective banks and generally push the process along – it normally takes about four weeks.

Q. Anything else for expats to consider when buying property?

Location is always important. Make sure you have easy access to transport links, schools, shops and communal facilities. But also check what’s happening around the property – if you’re looking for somewhere with a good view, be sure that it will remain that way and no future construction will obstruct it.

Often expats buy a property to live in and continue to have it as an investment when they leave the UAE. Properties can be managed and rents collected and sent anywhere as directed by agents based in Abu Dhabi.


Case study

Mona Hammami, 34, from Lebanon, has lived in the UAE for seven years. She recently decided to purchase an apartment on Saadiyat Island. She says, “I’ve been paying rent for a long time and thought it made sense to use that money to buy my own property. I am also getting married so it makes sense to buy a family home.”

The economic adviser also surveyed Al Reem and Al Raha, but fell in love with Saadiyat Island’s “sea views, ready facilities and nice community”. It also helped that the soon-to-be-opened Louvre Abu Dhabi is located in the same area.

Mona bought the apartment for AED 3.7 million and found the purchase process to be hassle free.

If you’re thinking of following in Mona’s footsteps, follow her advice.

“Look around and see as many properties as possible,” she says. “Decide if you’re looking for a property as an investment or as a home, as this will influence your decision on which area to live in.

“Keep in mind the costs of service, maintenance and transfers, as these things add up and aren’t usually clear at the start. If you’re financing the purchase yourself, I would recommend that you sit with your banker so you understand what your options are.

“Go with a broker as they know the market better than you and can give insights that a buyer is not aware of.”

Need to know

Owning a property here doesn’t guarantee residency – you still need to apply for a Property Holders Visa, which allows a foreign investor to stay in the UAE for up to six months. You cannot work on this kind of visa.

To qualify for this, the property you are purchasing must be worth over AED 1 million, and you must be the sole owner.

WORDS Ferdinand Godinez

Leave a Reply

Your email address will not be published. Required fields are marked *