Finance

Financing Property in Dubai is very difficult for foreign Investors unless you buy through the top 2 or 3 Dubai developers. The problem here is that you are then potentially restricted to only certain developments in certain areas.

You may read from Duabi brokers that on completion you can pay cash or raise the finance through a mortgage but at present a straight forward 70% or 80% LTV finance offering on completion in Dubai is simply not available.

*Do be careful when entering into property transaction as the mention of a mortgage on completion will relate to further equity release from the U.K and not standard finance for Dubai.

There is however one line of finance that is occasionally on offer, however this is arrnaged at time of reservation and monthly or quarterly payments will be made before completion of constuction and prior to any income being receievd.

Developer Finance

Developer finance is something that is becoming more readily available in Dubai but this isnt a simple mortgage as we would expect to leverage in the U.K.

Typically the developer will spread circa 50% of the value of the property over a 10-15 year period which negates the need for further cash lump sum instalment and improve your available cash.

Typical developer Finance Terms

50% LTV
9-10% Interest Payments
10-15 year term
Repayment Vehicle Only
Finance Payments begin prior to completion

Summary

When taking on any debt you need to be satisfied that the nett income generated can service the debt. The repayments on a 10-15 year loan will be significantly higher than on a standard interest only 20 year term so be sure to satisfy yourself as to the exact payments before proceeding. Always ask developers for example payment terms.