Buying and selling a car in Dubai

Time Out Dubai is your guide to living in Dubai, and as part of our residents' guide we have information on buying a car in Dubai and selling a car.

Area Guides, Community, Living in Dubai

Dubai’s love affair with wheels doesn’t stop at supercars and SUVs. In a city where petrol prices are among the cheapest in the world and pedestrian infrastructure is still developing, many choose to buy cars over walking, public transport or taxis. According to the managing director of Al-Futtaim’s used car division, Colin Cordery: ‘We are seeing more buyers switching from new to used in order to offset the increasing cost of living in the UAE. Over the past few years, the perceptions about buying second-hand cars have changed as the used car sector has become more structured and the government has issued legislation protecting the consumer.'

He also says that because Dubai is tax-free, cars are more affordable here. ‘With luxury tax or VAT, which is added to cars in various parts of the world, a car can be two or three times more expensive than here. The UAE offers many people the opportunity to buy a car which they could not afford in their domestic markets,’ says Cordery. If you’re in the market for a new ride you’ll want to read this before you shop around. Here, three experts share their tips on buying and selling a car in Dubai and what to look out for.

Which cars retain their value best in Dubai?
‘Anything with a Japanese badge on it will maintain good resale value, particularly commuter cars like Toyota Corollas, Tiidas and the Yaris,’ says managing partner of automobile website Motoring Middle East, Imthishan Giado. According to Cordery, one of the reasons there is a strong demand for Japanese brands in the UAE is that they hold good resale value, provided the owner takes good care of the vehicle. American cars, such as Jeep Grand Cherokees are also in high demand. But low mileage and a service record done by the car’s manufacturer aid the resale value of any vehicle. So what about those high-end rides we see cruising the roads? ‘Next in terms of desirability are luxury cars like Audi, Mercedes and BMW,’ says Giado. ‘Although the more expensive the car, the higher the drop in resale. Korean cars used to be on the bottom, but they’re rapidly gaining in reputation and popularity. Lowest on the totem pole are French cars – they struggle to sell, particularly in summer,’ he says.

Which cars are most popular?
‘This is an unusually skewed market towards larger SUVs,’ says Mark Kass of Al Futtaim Honda. ‘In the UK and other parts of the world you might see one in 1,000 SUV Landcruiser with a 5.78 VA engine. Here you see them one in ten. That really is down to the cost of running, fuel prices and disposable income,’ he says.

Which dealers offer the best rates?
‘Dealer prices are set by a combination of factors including the level of options required to sell the car, the cost of homologation [road worthiness] to GCC spec and the current value of currency, which can fluctuate dramatically,’ explains Giado. ‘The last factor can be crucial – the soaring yen has seen the price of Japanese cars rise considerably in the last three years, while European and American cars have never been cheaper,’ he says. Meanwhile, Kass says every dealer has different offers at different points of the year. ‘There isn’t such a thing as a best price for a car. You have to do your research, go in and have a test drive and choose a specification. It’s very important when comparing price and effectively you negotiate the transaction through that.’

When is the best time of year to buy a car?
‘Best time of year to strike a deal is during Ramadan,’ says Giado. ‘In summer, dealers are desperate to shift stock and will cut thousands off the price of previous model years.'

If you can’t buy outright, is three- or five-year finance best?
‘Anything that gets you through your loan agreement the fastest is ideal,’ says Giado. For every year you tack on in finance, you swell the amount of interest you pay. Five year rates get you a temptingly low monthly instalment, but it adds up to a hefty profit margin for the dealer as well,’ he says. Kass says that another popular offer is PTP, otherwise known as personal finance. ‘You put a down payment and pay a monthly sum, but at the end of the term you have three opportunities: give the car back and walk away, finance it for a further period or exchange it and buy a new car,’ he says. ‘It gives people that flexibility.’

Is it best to sell your car on a classifieds website, or through a dealer?
‘You will get the best value for your car through Dubizzle, selling to a private buyer; a dealer will always offer you less because there is a cost to him to get the car ready for resale, and to warranty it against any potential faults,’ says Giado. ‘Selling a car via Dubizzle only costs you a photograph and gets you the highest price. However, you will also be deluged by calls from dealers and private buyers, and some will waste your time. Once you have agreed on a price, you also have to get the car certified from [vehicle registration department] Tasjeel and then transferred, which can be a lengthy process,’ he says. ‘Selling a car via a dealer is simple and straightforward – you take the car to the dealer, they evaluate it in a few hours, sometimes immediately and then offer you a price. Once agreed, you receive a cheque and that’s it – the dealer takes care of transferring ownership and all other legal hassles.’

What can you do to make your sale look more attractive to potential buyers?
‘Clean it thoroughly, get the engine detailed, make sure all dings, dents and scratches are sorted and make sure the interior is spotless,’ says Giado. ‘Take a proper photograph. Go to the beach or somewhere picturesque and take a photograph with a decent camera – not your phone – good light from all angles,’ he explains. ‘Be as thorough as possible in your description, highlight any issues and if you have a full service history, highlight it as it can add thousands to your sale.’

Is there a particular colour that sells better?
‘Colours are very cyclical and the best selling colour in the world is probably still silver,’ says Kass. ‘We [Al Futtaim – Honda division] went through a spate in 2009 and 2010 where black became fashionable, but now black is no longer in vogue. Without a doubt, the best-selling colour in Dubai is white. It accounts for around 40 percent of our sales,’ says Kass. ‘It’s fairly neutral, it’s not fashionable and in the summer it keeps the coolest. Probably 90 percent of what we sell to Emiratis is white,’ he says.

What to ask at the showroom
‘Car shopping is mainly an emotional process. Dealerships will use all sorts of tricks to distract you into buying a car on your first visit,’ says Mohamed Noweir, of Carmudi. ‘Take your time, think about it thoroughly, and come back once you’ve made a solid decision.’ He suggests certain key questions to ask at the showroom.

‘How much is the car after additional fees and licensing?’
Go through the contract before you make any payments to avoid finding hidden or mandatory fees that you have to pay later. Asking this question will also signal to salesmen that you mean business and plan to land a good deal.

‘Could you show me all the features?’
Most people hold back from asking this question to avoid sounding like a dinosaur, but there is nothing wrong with wanting to know what your future car has to offer. Most people spend years without fully knowing what their car can really do.

‘What does the warranty cover? Are there any free perks I can get?’
Always get the warranty cleared up. Vehicle repairs and maintenance are the largest contributor in the car business and where dealerships stand to make a lot of money from you. It is important to know what costs you would have to pay, what you won’t be paying, and what you could get free.

‘Can I take the car for a test drive?’
Reading reviews is great, but it’s far better to jump into the driver’s seat and feel how comfortable it is behind the wheel.

Where to buy

Showrooms
Thanks to Dubai’s penchant for souk-style shopping, you can find an almost uninterrupted row of different car showrooms along Sheikh Zayed Road. First service road after Mall of the Emirates, heading towards Sharjah.

Dubizzle.com
A popular classifieds website with thousands of second hand vehicles for sale by owner and third party dealers.

Autotraderuae.com
Find a range of second hand vehicles here, including an impressive number of supercars and luxury vehicles.

The cost of shipping a car

Love your vehicle so much you want to take it with you on your move? We get a quote for an average-sized model being sent to three popular locations from expert movers Allied Pickfords.

Mini Cooper
Dubai to London: Dhs15,510
Dubai to Sydney: Dhs17,200
Dubai to Geneva: Dhs19,584
(Door to warehouse, price includes destination and customs services)

Rates are for those who are relocating and shipping vehicles for personal use, rules and taxes differ if shipped for sale. If shipping a small car, the same container can be used to ship personal effects for a more cost-effective move.
Allied Pickfords, various locations, www.alliedpickfords.ae (04 408 9555).

How to sell
Selling your car can be a headache, especially for those looking to purchase a new car and upgrade. Considering the cost of the car, plus the money invested in maintaining the vehicle, owners worry that they’ll be left out of pocket. ‘The resale value of a vehicle is subject to various factors,’ explains Samee Mitkar. ‘The general perception is that well-established brands fetch better resale values, which may not be the case on all types of model the brand represents, but the best volume selling or fast moving vehicles sell quicker than models that are low in demand.’

Owners planning on getting rid of their old cars can sell back to the retailer or use a registered online company to help find a new owner. Whichever method you choose, Mitkar advises owners to keep records. ‘It is always advisable to keep the periodic maintenance record and history of the vehicle that assures the vehicle’s current condition and leads to a better deal.’

In addition to selling, some may want to trade-in and upgrade. ‘Trade-in facilities are generally offered by the major auto distributors and is one of the most convenient and stress-free ways to upgrade to a new car,’ says Mitkar. Kunjithapadam Rajaram, CEO of Al Nabooda Automobiles (www.nabooda-auto.com), agrees that trade-ins are a good alternative to selling and re-buying. ‘Customers who trade-in their current vehicle may be able to offset the value against their next car. All pre-owned Audi vehicles go through a rigorous inspection check before it makes the grade as an Audi approved model, so the new buyer has total peace of mind.’ In terms of the best time to sell, Rajaram feels that buyers should hold off until September. ‘I would avoid the summer months when many residents are out of town and would suggest the start of the year and just before school terms begin.’

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