How much do you need to earn to buy a home in Dubai?

One of the most frequently asked questions raised by prospective buyers, particularly expatriates, when it comes to purchasing property in Dubai is this: "What is the minimum salary a person needs in order to purchase property in Dubai?

While it seems like an easy question, on the surface it's a lot more complex when in reality many factors come into play which determine whether you can actually secure your dream property in such a global city. With mortgage rules, maintenance costs, and legal fees, not just salaries, there's a lot more to consider than what meets the eye.

Dubai real estate market is filled with amazing opportunities for an investment, be it to live in the city or simply making a profitable investment. With Brighton To Burj as one of the best real estate and consulting companies in Dubai, we will take you through every step of the process. We have over ten years of experience in real estate consulting and market knowledge, and we can advice on everything from the right property to property laws in Dubai.

Let's get right into talking about the financial aspects of purchasing property in Dubai and what you'll need for your minimum salary as you take the exciting step into Dubai real estate.

What does It take to buy property in Dubai?

So, there are many things that are going to come into play as you buy property in Dubai. These include the following:

• What kind of Property: You can be looking for a villa, an apartment, or maybe even some commercial property. Obviously, there is a huge difference in price in these examples.

• Location: Areas in Dubai which are more expensive include Downtown Dubai, Dubai Marina, and Palm Jumeirah. Therefore, no matter what your monthly salary is, your specific cost of living will be just as important.

• Mortgage Rules: Even though most people tend to finance their property through a mortgage, acquiring what loan amount you can qualify would highly depend on your sources of income and, above all else, on the creditworthiness.

Minimum salary to buy property in Dubai

Dubai does not have an absolute law that would require the setting of a minimum amount of salary required to qualify to purchase property, but there are monetary barriers and regulations that guide people in understanding how much they would need to qualify for a mortgage and make a purchase. Among the things are that your monthly salary, the type of property you intend to buy, and the financial obligations that will come with the purchase are taken into consideration.

1. Requirements for Availing Mortgage Loan

Even if you are trying to raise the finance to pay to buy your home on a mortgage, your income plays a vital role in determining exactly how much loan you might get. There are strict regulations on mortgages by the UAE Central Bank in an effort to ensure that buyers do not have any problem making monthly payments.

• For the first-time buyers for a property, at least 20-25% of the value of the particular property acquired has to be paid by the individual.

• For non-first-time buyers, that is, you have acquired a property somewhere in Dubai and paid for it previously, then a 30-35% down payment is required.

• Generally, almost all banks will lend up to 80% of the value of the property if you are a resident in the UAE. The remaining 20% would be taken from your pocket.

But your monthly mortgage should not be more than 50% of your income (this is what is called the debt-to-income ratio). So, if you are earning AED 15,000 per month, banks will typically not approve a mortgage if the monthly installment is above AED 7,500.

2. Property Prices in Dubai

The price of property in Dubai significantly varies by location and type. For example:

• Apartments in Dubai Marina: starting from AED 1.5 million and going all the way up to AED 5 million

• Villas in Palm Jumeirah: from AED 3 million, upwards of AED 20 million, varying in size, style, and proximity to water.

For a more budget-friendly individual, as an example, Jumeirah Village Circle (JVC) or Dubai Sports City may start at AED 500,000 on the lower end for smaller one-bedroom flats.

3. Other Costs of Owning a Property

But what many do not know is that buying a property in Dubai comes with more costs besides mortgage payments. These can range from:

• Property registration fee: The actual purchase price is what you pay for in most cases when it comes to registration fees in Dubai, about 4% of that.

• Maintenance fees: The majority of communal areas in most properties are paid annually and can range between AED 10 to AED 25 per square foot.

• Real estate agent fees: When hiring an agent, most charge a 2% commission from the sale price.

For home insurance, not mandatory but always sensible to have one for it may cost between AED 1,000 to AED 3,000 a year based on the value of your property.

All these things you just have to keep in mind while considering salary you will have as whether you can afford your financial commitment towards owning a property in Dubai.

How much salary does one need to pay for specific types of properties?

Now that we know the general expenditure for purchasing property in Dubai, let's break it down by kind of property and how much salary you might need to get a mortgage.

1. Budget-friendly apartments

Now let's take a one-bedroom apartment in a developing area like JVC or Al Furjan, which might cost somewhere around AED 600,000.

• Down Payment: You would pay 20% as a down payment, which is AED 120,000.

• Mortgage Loan: You will finance the remaining AED 480,000 through a mortgage, and the monthly installment would be somewhere in the region of AED 2,000 to AED 2,500 depending on what loan tenure and interest rate they offer.

• Minimum Salary: Banks usually insist that your mortgage payment shall not exceed 50% of your salary. So you must have a minimum of AED 5,000 to AED 6,000 a month.

2. Apartments in Dubai Marina Deluxe

The price of a two-bedroom apartment in Dubai Marina is around AED 2.5 million.

• Deposit: The deposit will be 25%, that is, AED 625,000.

• Mortgage: You will pay for the rest, which is AED 1.875 million. Your monthly mortgage may range from AED 8,000 to AED 10,000 depending on the loan term and interest rate.

• Amount Needed in the Hand: With a 50% debt-to-income ratio, you would need to have a monthly income of AED 20,000 to AED 25,000 to be able to easily service this mortgage.

3. Luxury Villas in Palm Jumeirah

Luxury villas on Palm Jumeirah can go as high as AED 10 million.

• Down Payment: The down payment for this type of property will most probably be 30%, or AED 3 million.

• Mortgage Loan: You would still have to mortgage the balance AED 7 Million. This would work out into monthly mortgage paying a sum in the ranges of AED 25,000 to AED 35,000.

• Required Salary: With such a huge mortgage payability which may amount to AED 50,000 to AED 60,000, it is required that one would qualify for this property.

How to secure your dream property in Dubai?

But, with the right salary and knowledge about mortgage rules, an apartment in Dubai is no longer a dream far away. Here's how to make it happen:

• Select the Right Property: Research various areas and types of properties to find something that suits your budget and lifestyle goals. Be it luxury in Marina or an affordable option in JVC, everything exists here in Dubai's real estate market.

• Get Mortgage Pre-Approved: Approach a reputable UAE real estate agency such as Brighton To Burj and get pre-approved for your mortgage. This will give you an idea of how much you are eligible to borrow at that salary level.

• Consult a property expert: Partner with a professional real estate and consulting company in Dubai such as Brighton To Burj to be able to guide you through the buying process. With our aid, we will make sure that you get the best deal possible and that your finances are right, and we will find just the right property for you.

Brighton To Burj is the leading real estate and consulting company in Dubai having more than a decade of rich experience in this fluctuating real estate market of Dubai. We are here to make your journey smooth, ensuring you receive proper advice, excellent services, and the finest investment opportunities.

Let's get talking today and turn your property dreams into reality.