5 Tips on how to save for a down payment on a house in Dubai

Are you tired of paying rent at the end of every month and planning to have your own home? Buying a house is one of the biggest decisions you will ever make in life. One of the main reasons that hinder most people from buying their own house is the cost involved. In Dubai, you are required to pay a down payment and the balance is spread over a certain period of time. However, since the down payment involved is too high for most people, they resort to paying rent.

Currently, there are numerous new real estate projects in Dubai. So, if you are looking forward to owning a home, you will find many options located in different parts of the city. For example, there is a rich selection of apartments for sale in Downtown Dubai at varied prices.

Here are some tips on how you can save for the down payment

i.             Budget

The first step to start saving for the down payment is to know how much the house will cost. This will depend on certain factors such as your financial position, the location of the property, etc. You will need to research the price range of the house you are looking for. After determining the amount of money the house will cost, you will need to create a budget.

ii.            Minimise the expenses

How you normally handle your finances will determine how much money you will be able to save. Start by looking at your gross income and how much goes into paying regular bills and expenses. Tracking your spending is a great way to see how much you spend on unnecessary stuff. You can save significantly if you cut down on some of the expenses temporarily or permanently. For instance, instead of using a taxi, you can start using public transport. Always find affordable alternatives as much as possible.

iii.           Open a saving account

Opening a saving account is one of the best ways of saving up for the down payment. This way, you will be able to separate your everyday spending from the down payment fund. Setting up an automated plan is the best way to operate a saving account. A certain amount of your salary will be automatically transferred to your saving account.

iv.          Downsize

If you are living alone, you can move from a one bedroom apartment to a studio apartment to cut on your monthly rent. Also, if you are renting in a leafy suburb, you can find other affordable locations where you will pay less money. 

v.            Pay off your credit cards

If you really want to save for the down payment for that apartment in Bluewaters Residences which you have been eyeing since long, you will have to reduce the credit cards that chip away your monthly income. Make sure you have paid all the debts to focus on saving.