- Important Things to Consider
- Finding the Right Property
- Popular Areas for Investment
- Property financing in RAK
- RAK Property Legal Requirements
- Property Ownership Costs
- FAQs
The northernmost Emirate of Ras Al Khaimah (RAK) is known for its stunning natural beauty, diverse cultural heritage and modern lifestyle. With a rapidly growing real estate market, RAK has also become a popular investment destination in recent years. The up-and-coming real estate developments in the Emirate have garnered the interest of both property buyers and investors.
From property hunting to associated investment costs and necessary documents, here we have compiled a comprehensive guide to buying property in RAK.
More About RAK’s Thriving Real Estate Market
According to dubizzle’s RAK property market report for H1 2023, the emirate has recorded a significant surge in the demand for properties. The heightened interest of investors and buyers has led to the emergence of several new property developments in RAK.
Projects in Mina Al Arab, Marjan Island and Al Hamra Village are creating a buzz among those looking for properties for sale in RAK. Most of these new property developments in RAK are introduced by RAK Properties, a property development firm supported by the government of RAK.
Things to Consider Before Buying Property in RAK
Buying property requires considerable investment. It is a decision that should be taken in a well-informed manner. Whether your investment is driven by short or long-term goals, here are some important things to consider when buying a property in RAK.
- Before investing in real estate, it’s important to have your finances in order. You should consult banks, real estate agents and mortgage brokers to find the best rates. Weigh your investment feasibility in terms of cash vs mortgage when buying a house in the UAE.
- Carry out thorough market research to learn about the different property types in the UAE. You can invest in residential, commercial or even industrial property.
- Research the location of the property. It is an important factor to consider when investing in real estate. You should research the area and find out about the local amenities, schools and transport links. Check if any key UAE highway routes are nearby.
- Decide between short-term and long-term rentals. However, it depends on your investment goals. Moreover, short-term rentals in Dubai are more popular due to the Emirate’s global recognition among expats and tourists.
- Expats looking for property investment should know about freehold areas in Ras Al Khaimah. Besides non-GCC residents, foreign investors can also buy properties in the freehold communities in the city.
- Buyers must ensure that the seller is the rightful owner of the property. Moreover, all expenses have been paid and there are no further expenses expected due to construction or renovation.
How to Search for Your Ideal Property in RAK
When searching for an ideal property in RAK, one would come across plenty of options. To narrow down the available choices, consulting a real estate professional would be a feasible solution. Using their market knowledge and connections, property agents can help investors save time and resources. In addition to this, there are many other benefits of hiring a real estate agent.
Besides seeking help from field experts, property seekers can also turn to online platforms to carry out their search. Whether you are looking for apartments or popular areas with villas for sale in RAK, UAE’s leading platforms like dubizzle can help you effectively filter your search. The intended listing on dubizzle will also be useful to get an idea of the latest asking prices of the desired property.
Popular Areas for Buying Properties in RAK
With an emerging property market, Ras Al Khaimah has recorded a significant increase in new property developments. According to the dubizzle H1 2023 market report, the following have been the most popular areas for buying apartments in RAK.
| AREA | ROI | AVG. PRICE | STUDIO | 1-BED | 2-BED |
| Al Hamra Village | 7.60% | 566,000 | 298,000 | 497,000 | NA |
| Al Marjan Island | 6.73% | 807,000 | 355,000 | 663,000 | 1,100,000 |
| Mina Al Arab | 4.74% | 1,100,000 | 451,000 | 831,000 | NA |
| Yasmin Village | 11.70% | 308,000 | NA | 246,000 | 301,000 |
| Al Seer | 8.89% | 234,000 | 189,000 | 300,000 | 362,000 |
Similarly, to looking for larger accommodations have opted for villas. The ROI and average prices of top areas for buying a villa in Ras Al Khaimah have been shared below.
| AREA | ROI | AVG. PRICE | 3-BED | 4-BED | 5-BED |
| Al Hamra Village | 4.87% | 3,468,000 | 1,700,000 | 2,900,000 | 9,178,000 |
| Al Marjan Island | 4.43% | 4,884,000 | 2,684,000 | 4,957,000 | 6,391,000 |
| Mina Al Arab | NA | 7,790,000 | 5,720,000 | 7,800,000 | 13,680.00 |
Carefully Plan Your Finances
Since buying property in RAK involves large sums of capital investment, knowledge of home financing in the UAE is a must. The loan-to-value ratio may also be different for a UAE and a non-UAE resident.
Similarly, mortgage caps also vary from investor to investor. It also depends on property valuation and the amount of investment. For instance, the mortgage cap for a UAE resident is 80%, whereas for a non-UAE resident, it is 65%.
That said, securing a mortgage in the UAE doesn’t come easy. Check your debt-to-income ratio and credit score before applying. These are among many other useful tips to avoid getting your mortgage loan application denied.
Document Requirements
Any transactions for buying property in Ras Al Khaimah will not be completed until all document requirements are fulfilled.
For ready properties
On the day of transfer, the following documents are required:
- A No Objection Certificate from the developer/seller
- A cheque amounting to the property price, which is payable to the seller.
- Original identification of buyer and seller (Emirates ID, Passport and visa)
- Signed Form F / Memorandum of Understanding (MoU)
- A legally verified title deed for RAK property ownership
For off-plan properties
- NOC issued by the developer/seller
- Sale and Purchase Agreement (SPA)
- Oqood (a temporary registration document until the property completion date)
- Oqood is converted into a title deed upon property completion
For a detailed comparison of ready-property vs off-plan property investment, read here. It is always good to weigh the available investment options in an informed manner.
Property Ownership Costs and Fees to Know About
Like other Emirates, there are no property taxes in RAK. However, there are other financial liabilities that property owners must bear. The property registration fee in Ras Al Khaimah is 2% of the property value for both the buyer and seller.
In terms of property registration through the Sheikh Zayed Housing Programme, the grant is AED 1000 and the loan fee is AED 500 + 2% of the difference between the financial assistance and property value. Similarly, the seller has to pay 2% of the property value.
The title deed issuance fee is also a part of these real estate transactions, which is AED 250. Property owners also have to open up a FEWA account to have running utility connections on their premises. There are no FEWA account activation charges, however, there is a deposit fee from AED 1,500 to 2,000. Consumers have a six-day window to deposit it online.
Property ownership costs and fees are subject to change and depend on property value. It is ideal to conduct research and consult a real estate expert before conducting any transactions. Moreover, make sure to be aware of the common real estate investment and rental property scams to prevent any financial losses.
FAQs
What are some tips for Buying Properties in Ras al Khaimah (RAK)?
Consider your finances carefully, research property types, evaluate the location and then decide between short or long-term rentals based on your goals. Verify property ownership, be aware of freehold areas and understand the associated costs and fees.
What documents do I need for RAK property investment?
For ready properties, you need a No Objection Certificate, buyer and seller identification, a signed Form F/Memorandum of Understanding, and a title deed. For off-plan properties, you require an NOC, Sale and Purchase Agreement and Oqood (temporary registration document), which converts to a title deed upon property completion.
What are the property ownership costs and fees in Ras Al Khaimah?
There are no property taxes, but buyers and sellers pay a 2% property registration fee. Under the Sheikh Zayed Housing Programme, buyers pay a grant and loan fee while sellers pay 2% of the property value. There’s also a title deed issuance fee of AED 250 that completes the property buying process in RAK. These costs may vary based on property value and are subject to change.
This brings us to the end of our RAK real estate investment guide. It outlines all the key aspects and legalities involved in terms of property ownership in the UAE. Those seeking home financing opportunities should check out this home loan process guide for the UAE.
Real estate investors and buyers in the emirate can explore these properties for sale in RAK to find an option suiting their requirements and budget.
For more updates on the RAK property market, keep following dubizzle’s property blog.
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