Property Buyers in Dubai Must Pay 6% More Upfront as Banks Stop Financing DLD

Date:

Share post:

From upcoming week potential property buyers in Dubai who choose mortgages must provide the Dubai Land Department (DLD) fee together with brokerage fee at purchase. Before February 1 real estate industry executives confirmed banks added the four percent DLD fee and brokers two percent charges into mortgage financing totals.

Property Buyers in Dubai Must Pay 6% More Upfront

Property buyers in Dubai who secure mortgages can no longer use their loan to pay 4% Dubai Land Department (DLD) fees and 2% brokerage expenses starting from February 1, 2025. The new policy requires homebuyers to handle the expenses themselves which means their initial investment needs to be increased.

Property buyers must pay a 4% DLD fee as part of their property purchase total because it remains a mandatory registration charge that affects the final price. Prospective homeowners who want to buy a 1,000,000 AED property must first allocate approximately 60,000 AED as initial fees.

The step forward coincides with guidelines from the UAE Central Bank which orders financial institutions to cease lending money to fund property acquisition fees for buyers. To purchase their ideal home buyers need a bigger down payment under this new system.

Dubai properties require a minimum deposit set at 20% for values between AED 5,000,000 and lower which increases to 30% for properties exceeding AED 5,000,000. Central Bank rules require all property buyers to meet minimum requirements and allow first-time homebuyers to secure mortgages for seven times their yearly earnings.

Also Read: Top 7 Best Restaurants Near Legoland Dubai That Are Perfect For Dining

To buy a property worth AED 1,000,000 an expat must pay AED 200,000 (20%) initial deposit alongside AED 60,000 in fees. This brings the total required payment to AED 260,000.

The new rule would possibly redirect real estate preference towards new construction properties. The flexibility that developers provide to off-plan project buyers involves minimal initial payments and in certain situations developers will waive the DLD costs. Some developers compensate for the elevated upfront costs by paying select DLD fees either completely or partially thus making the property more attractive to buyers.

Customers need to pay both 4% DLD fees and 2% brokerage amounts before buyers can continue with property purchases. Property buyers who are expats require a minimum 20% down payment when purchasing real estate valued under AED 5,000,000. The market for off-plan properties may experience increased appeal because developer incentives are made available.

Dubai Property Prices Set to Rise

When buying real estate in Dubai you must carefully prepare your budget as you investigate flexible payment choices with developers. Enterprises operating in Dubai’s progressive real estate sector require clients to have financial preparedness.

Related Posts

Related articles

New Expo 2020 Dubai Museum Opens with Free Entry for Launch Weekend

Dubai's cultural scene is about to get even richer with the grand opening of the Expo 2020 Dubai...

Latifa City: A Tribute to Motherhood and Social Prosperity in Dubai

In a significant move to enhance the lives of Emiratis, Dubai has unveiled a new residential area named...

Abu Dhabi Visa Screening with AI-powered TB Detection

AI Tech Streamlines Visa Screening Process, Increases Efficiency, and Improves Healthcare Delivery Abu Dhabi is taking a giant leap...

5 Most Stunning Islands in Dubai Everyone Should Visit

Islands in Dubai: Dubai gains recognition worldwide because of its stunning cityscape along with its glamorous way of...