Everything you need to know about purchasing your second home in Dubai

A second home in Dubai typically refers to a property purchased in addition to your primary residence. Many buyers invest in a second home here for various reasons, including lifestyle upgrades, a holiday retreat or as an additional source of rental income.  

Dubai’s attractive property market and cosmopolitan lifestyle make it a prime destination for such investments. At haus & haus, we guide buyers through every step of the purchasing journey, ensuring you understand the market, financing options, legal requirements and after-sales management. For more details on properties available, explore our Dubai properties for sale.

How to buy a second home in Dubai

Buying a second home in Dubai can be straightforward if you follow the right steps:

1. Define your purpose and budget – Decide if the property is for investment, holiday use or long term residence. Set your budget, considering whether you will pay cash or require mortgage financing.
2. Check eligibility – Dubai allows residents, non-residents and Golden Visa holders to purchase freehold property.
3. Choose a freehold area – Identify a suitable freehold community that aligns with your goals.
4. Engage a real estate agent – Work with a trusted agent who understands the market and can assist throughout the process.
5. Sign the Memorandum of Understanding (MOU) – This outlines the terms of the sale.
6. Pay the deposit – Usually 10% of the purchase price.
7. Obtain the No Objection Certificate (NOC) – Required from the developer to proceed.
8. Complete ownership transfer – Finalise the sale and transfer ownership at the Dubai Land Department (DLD).

Financing your second home in Dubai

Purchasing a second home in Dubai requires careful consideration of your financing options to ensure the investment aligns with your financial goals and circumstances. Whether you plan to use traditional mortgage lending, tap into the equity of your existing property or explore alternative funding methods, understanding each route’s requirements and implications is essential. Below, we outline the most common financing options available for second-home buyers in Dubai, helping you make an informed decision that suits your needs.

Second home mortgage options

Mortgages for second homes in Dubai typically come with Loan-to-Value (LTV) caps ranging from 65% to 75%, lower than first-home loans. Terms may be stricter, with higher interest rates expected. Buyers can choose between fixed or variable interest rates, depending on risk preference and market conditions.

How to buy a second home using equity

Equity release allows homeowners to unlock value from their existing properties. Typically, 50–80% of your home’s value can be released to finance a second property, consolidate loans or invest elsewhere. This option offers flexibility, especially for buyers with significant equity built up.

Alternative financing routes

Other financing options include:

• Piggyback loans or secondary mortgages, which can help cover deposits or parts of the purchase price alongside your main mortgage.
• Developer payment plans, especially for Off Plan properties, allowing you to spread payments during construction — often with little or no interest.
• Cash purchases, which enable quicker transactions and no financing hurdles but require full funds upfront.

Each option has pros and cons, so consulting an expert is recommended. For more details on Off Plan opportunities and payment plans, visit our Off Plan page.

Costs & stamp duty for second homes in Dubai

When purchasing a second home in Dubai, you should anticipate several costs beyond the purchase price. Dubai Land Department (DLD) fees include a standard 4% transfer fee applied to the property price. There are also administration and trustee fees that cover processing and documentation. Agency fees, typically around 2%, represent the commission paid to your real estate agent.

Unlike many other countries, Dubai does not impose annual property tax or capital gains tax on property sales, making it a favourable environment for investors.

How to reclaim stamp duty on a second home

Dubai does not impose traditional stamp duty, so there is no reclaim system similar to the UK. The 4% DLD transfer fee is non-refundable and applies uniformly to all property transactions, including second homes.

However, some developers may offer promotions that cover part or all of the DLD fees as incentives. It is advisable to explore these options with your agent to maximise potential savings.

Working with an experienced brokerage like haus & haus ensures you stay informed about any available incentives or exemptions.

Tax implications and deductions for second-home buyers

Dubai’s real estate market benefits from a highly favourable tax environment. There is no reclaimable stamp duty, no capital gains tax and no annual property tax. While some developers or brokers may offer fee rebates or partial reimbursements as part of promotions, these are exceptions. Partnering with an experienced agent ensures you stay informed about any available financial incentives or tax-related benefits that could apply to your purchase.

Benefits of owning a second home

Owning a second home in Dubai comes with multiple benefits. It offers the opportunity to generate rental income through short term or long term leases, providing a valuable additional revenue stream.  

A second home offers lifestyle flexibility, allowing you and your family to enjoy a holiday home or have convenient access to the city. Investing in an eligible property can also support qualification for the Dubai Golden Visa, granting residency and related benefits. Furthermore, Dubai’s dynamic property market can offer significant capital appreciation over time, increasing the value and resale potential of your investment.

Considerations when purchasing a second home

Purchasing a second home involves higher financial and management responsibilities. Generally, lenders require a larger down payment for second homes and mortgage rates may be higher compared to first time purchases.  

If the property will be rented out or left unoccupied, it is essential to arrange for property management services to maintain the home and manage tenants. Additionally, service charges and maintenance fees for communal areas and facilities should be factored into your ongoing costs.