Buying Property Directly from Owner in Dubai: Pros and Cons to Know

Whenever someone wants to buy a property in Dubai, they must choose between purchasing it directly from the developer or with the help of a broker. Here, we’ll discuss some of the benefits and drawbacks of purchasing property directly from an owner in the Dubai real estate market. You’ll be able to make a better decision based on your needs.

Pros:

The advantages are as follows:

Cost Saving: One could save money by purchasing directly from the owner, as the agent typically charges between 2-5% of the property's value. Additionally, agents add a 5% VAT on their fees.

Direct Communication: Without a middleman, there is less chance of miscommunication. This also reduces the risk of being misled, as the buyer deals directly with the owner.

Flexibility: When no agents are involved, there is more room for negotiation. The owner may be willing to reduce the price or change the terms of the sale, especially if they are eager to sell the property quickly. Buyers can also negotiate better financing options that may not be available when working through agents.

Personal Touch: Buying directly from the owner can create a more personal connection, potentially leading to a smoother handover and better after-sale support.

Cons

Limited Options: Buying directly from the owner limits your exposure to the varieties of property in Dubai because owners do not heavily advertise their properties in 50% of the cases.

Lack of Expertise: In the absence of a real estate agent, the buyer might find Dubai's complex property law and regulations difficult to handle.

No Protection: Should something go wrong during the transaction, the buyers are not protected in the same way they would be with an agent or developer.

Due Diligence: Buyers have to conduct due diligence on their own, regarding ownership of the property, liabilities, and any outstanding debts.

Time-Consuming: Finding a property can take great effort, and negotiating directly with an owner can consume a lot more time.

Considerations:

If you want to buy property without involving a middleman you need to understand the potential risks that stem from having limited choices, lack of professional experience, additional responsibility for due diligence. In light of these risks, some precautions a buyer shall take are:

1. Conduct thorough research about the property in question and check its ownership.
2. Get advice of a lawyer to determine whether the property and purchase procedures are in compliance with Dubai's property laws.
3. Negotiate clearly defined terms and conditions.

Besides knowing the merits and de-merits, real estate investors should be well-informed of the emerging trends and the regulations in Dubai’s property market. This will help him reach a decision that fits his budgets, preferences and objectives.

FAQs

Q: How does one ensure that the property is free from liabilities?

A: You should review the property documents and conduct a thorough search of the title deed. You will also have to verify any outstanding debts or mortgages relating to the property with the Dubai Land Department. Also get a No-Objection Certificate (NOC) from relevant authorities. You can hire a lawyer or real estate expert for this due diligence phase.

Q: What are the usual payment terms offered by the property owners in Dubai?

A: Payment terms can vary but here are commonly practiced terms.

1. Cash payment
2. Payment in monthly installments

Bank financing (with the owner's approval)