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Visa’s and Property Finance Explained

In April 2022, it was announced that the Golden Visa’s is now applicable to anyone with or looking to purchase a property off plan or ready with the minimum value of AED2,000,000, which has been lowered from AED10,000,000 to meet the requirements of the influx of end user without the need of a local sponsor.

The alternative is the ‘Investor Visa’, valid for two years, renewable, for the owner (and spouse) of a property or properties which make up the value of AED750,000 in equity. If the property is financed (mortgaged, 50% of the property value A non-objection letter in Arabic along with a mortgage bank statement will be required to proceed with visa application.  Investors in a jointly owned property are eligible to apply if each individual’s share is worth at least Dh750,000.

The Advantages of Having A UAE Residency Visa

Non-Resident Finance

Investors living outside the UAE are able to avail for mortgages up to 75% LTV on their first property and up to 60% LTV on any subsequent property with no limit as to the number of units mortgaged subject to eligibility. 

For the interest rates you can expect from 3.50% up to 5.50% depending on the lender you take the mortgage from.

Resident Finance

Expat UAE residents are able to avail for up to an 80% LTV mortgage on their first property and up to 60% on any subsequent property again with no limit on number of properties subject to individual lending policies of the banks.

Along side the mortgage there are a number of ancillary fees when purchasing a property in Dubai, such as;

For the Dubai land department fees and the RERA 2% real estate broker the fee, some banks can offer assistance with additional finance whether that be by adding an additional 4.8% of the property price to your mortgage or by way of a fee financing loan for up to 10% of the property price.

Off Plan Mortgage

If a property is 3 months from completion the mortgage can be applied for, it has been widely reported that the larger developers will not be offering post payment plans or DLD Waivers as they have done in the recent past. 

HSBC have teamed up with Emaar to offer exclusive handover mortgage rates as low as 1.85% subject to eligibility.

A more and more popular mortgage being taken at the moment for both UAE residents and Non-Residents is the Equity Release.

An equity release mortgage is simply taking a mortgage on your property you have already purchased and releasing cash equal to a percentage of the property value.

You can also do an equity release if you already have a mortgage on the property.

You can do this by way of a buyout (remortgage) plus equity release.

Typically this can be considered up to the LTV’s of a normal mortgage for a purchase but typically the rate is slightly higher.

Trade License

In line with the current economic climate this is now reversed we are seeing more Developers offering a Trade License for ‘Work from Home’ purposes and to attract more ‘Freelancers’ or ‘SME Companies’ to the Region.  Dubai Multi Commodities Centre (DMCC) has partnered with Emaar, on the Executive Residence in Dubai Hills Estate. 

Alternatively, you can set up a company with Visa’s for as little as AED15,000 up to AED50,000+ depending on the activity of the business.  I do not think it is any secret of the benefits of having your business and owning property in Dubai but the main one is 0% income tax.

For further information please do not hesitate to contact me.

Laura Adams – laura.a@providentestate.com

contributions from Head of Mortgage’s at Premier Finance and Zara at Prism Conveyancing.

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