Congratulations! You have finally reached the stage where the property you purchased in Dubai is finally ready. You can now sell it at higher rates to earn a high ROI, rent it out to have a passive stream of income, or move in to enjoy a comfortable lifestyle.

However, before you do any of this, you will have to go through the property handover and snagging process. This seemingly simple process can prove to be quite daunting if it’s your first time buying property in Dubai.

To help you with this, we are sharing a comprehensive guide to property handover in Dubai. Continue reading!

Property Handover Guide for First-time Home Buyers in Dubai

Receive Completion Notice

This is the first step of property handover. You will receive a completion notice from the developer when the building is complete. Generally, it is sent to the postal and email address of the buyer, which they registered at the time of buying the property.

The developer requires the buyer to complete the handover formalities within 30 days. Otherwise, they may get penalised.

The competition notice typically contains obligations or prerequisites set by the developer. It is important for the buyer to fulfil these obligations before taking possession of the new property.

Property Snagging

Conducting a thorough physical inspection of your new home before moving in can save you from great troubles in the long run. It allows you to identify any flaw in the property and communicate about the same to the developer, who will be responsible for fixing it before you take possession.

Property Snagging

It is important that you inspect the property thoroughly so that you do not miss out on any defect. The right approach is to make a written list of the prevalent issues. Once you have inspected the property, forward this list to the developer. They will then pass it to the contract so that all the issues can be fixed at the earliest. Make sure to keep a copy of this list with you. It may come in handy for any subsequent follow-ups.

In general terms, it is known as property snagging. It’s not a compulsion, but certainly most recommended. Not doing this is one of the biggest property buying mistakes. You must carry it out before signing the handover papers. Doing it after the property handover can prove to be quite complicated. You may have to make quite a few follow up calls to the developer so that they can fix the prevalent issues.

And if you fail to carry out snagging services within the specified time, you have to waive your rights to the property inspection. This means accepting the newly purchased property as it is. If there’s any repair work left to be done, it will be your responsibility to deal with it.

If you are new to Dubai, you can consider hiring professional snagging services. Since they have experience and expertise in inspecting houses in Dubai, they will be able to identify flaws that you may not be able to observe.

Property Handover Notice

After the contractor has completed the repair/rectification process based on the list you have provided to them, you will receive a property handover notice from your developer. The buyer is intimated through this letter to make an appointment with the developer’s handover team to complete the proceedings and get possession of the property. 

Payment Clearance

The completion notice comes with a handover pack. It includes the buyer’s account statement or property completion details with the developer, outlining what the buyer has paid and how much amount is left before they could take possession.

Generally, the closing costs include:

Last Instalments

The buyer is required to clear any final dues pending from the total cost, depending on the terms and conditions of the contract. If there were any penalties levied on the buyer for late payments, they must also be cleared during this stage. Furthermore, if the buyer fails to make the final instalments in time, further late payment charges can be levied on them.

Oqood Fees

Oqood means “contract”. This is basically the pre-registration of a property with DLD (Dubai Land Department). According to the law, all off-plan sales must be registered with DLD. The Oqood system records these registrations. The buyer has to pay Oqood fee of AED 1040. This figure also includes admin and knowledge fees. Furthermore, the standard unit registration fee is also charged at 4 per cent of the property purchase price.

Registration Fees

Property owners are required to pay registration fees of 4 per cent of the purchase price along with AED 580 as the fee for title deed issuance. Defaulting on this payment obligation may result in getting penalised.

Service Charges

For a residential building, service charges are borne by all the property owners. These are paid to cover the maintenance and upkeep of the building amenities and facilities, including but not limited to swimming pools, parking space, gardens, gyms, security, etc.

These charges are governed by RERA and calculated on the basis of the total area of the property. The buyer has to pay these charges in advance on a quarterly basis

Administration Fees

Not all, but most property developers charge an admin fee to the buyer. This covers the cost of paperwork required for the property handover process. The amount varies from developer to developer. However, it is roughly charged somewhere between AED 500 and AED 1000.

Utility Registration Fees

The buyer is required to register utilities prior to the property handover. For DEWA registration, the amount charged is AED 2,110, which includes the refundable amount of AED 2000. Charges for air conditioning depend on the District Cooling provider.

The buyer needs to provide the receipts of these payments to the developer for the completion of the property handover process.

Final Handover

This step involves the presence of all property owners or represented by their power of attorney to sign the property handover process. It takes place after the buyer is satisfied with the property’s condition and the payments are cleared and duly acknowledged by the developer.

It is important to bring the required original documents, including passport, utility receipts, sales and purchase agreement, payment receipts, etc., for the proceedings. The developer’s responsibility will be to prepare the necessary paperwork and provide the buyer with key release forms, payment clearance certificate, access cards/keys, etc., after they have signed the documents.

Wrapping Up

This marks the closure of the property handover process in Dubai. It is important to seek guidance from experts in the industry to avoid any hassle that can prolong the process.

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