Buying a car in Dubai

Buying a car can be a relatively painless exercise if you know what to look out for:

1. You'll need a driving licence to buy a car.
2. More often than not, you're probably going to need an auto loan as well (see Auto Loans below). banks usually only approve auto loans for cars under 5 years old, and loans can range from 1 year to 6 years term
   
3. You're going to need to decide what kind of car you want to get -- 4x4? Sports car? Family Saloon? All of the above?
4. Insurance -- premiums are usually computed as a percentage (as low as 3.5% of declared value or loan quantum, depending on which is higher, for a normal sedan/saloon, 4 to 6% fr a 4x4, 6% to 10% for high performance cars / convertibles

Auto Loans

If you've been here for less than 3 months, or have not been confirmed by your employer, banks will usually limit the loan quantum to approx AED75k. Of course, you can also get a personal loan (usually of a similar quantum) to use as downpayment. Not the best way to go about it, but it works.

There are normal Auto loans and Islamic financing -- the difference being that under Islamic financing, you won't be penalized an early settlement fee if you decide to sell the car early. Nice :)

If you are buying a car, banks usually require you to provide a release paper from the seller (if the car is used) to prove that the car is not mortgaged. This is to protect the bank. However, it also means that the seller is going to have to settle his/her outstanding loan before he/she can sell that car.

To apply for an auto loan, you'll need to provide your salary transfer letter (or salary certificate), driving licence, a copy of the car's registration card, and the previous owner's driving licence.

Once the bank has approved the loan, they will provide an LPO (i.e. promissory payment note) to the previous owner and a loan approval letter. With the loan approval letter, you'll need to get a copy of the registration card (insurance company just needs the engine and chassis numbers), your UAE driving licence, and a copy of your No Claims Letter (if available) from your previous insurer.

With that, you should get your insurance cover note or policy document (not the same, but either will usually suffice), and with that, you'll need to head over to a Tasjeel/Shamil and RTA registration centre to do the transfer of ownership -- owner does not need to be there, just a copy of his driving licence, his registration card, your UAE driving licence, your insurance policy, your loan approval document, and get in the queue.

Previous owner will need to pay off all outstanding fines, and if the car is more than 2 years old, you'll need to pay AED150 (or was it AED50) for vehicle inspection at Tasjeel/Shamil, AED650 for the registration, AED150 for the express service (optional, but makes it all so much faster).

Choosing a car

Petrol costs SGD0.35 per litre here, compared to SGD2.20 per litre for RON98 Premium Unleaded.

There's no road tax (i.e. penalty for large displacement engines).

So, where do we start?

If you plan to be doing dune bashing, you'll want a 4x4. For soccer mums and people who believe that 4x4s and SUVs offer more safety, think twice -- a bigger, heavier car is less likely to be able to swerve its way out of trouble, and braking also takes a longer distance. Chances are, you're going to end up in an accident, but 'safe' -- assuming another SUV doesn't smash into your car, or worse, the side of your car.

That's just something to think about -- a false sense of security? You decide.

Personally, and I mean this in every sense of the word, I'd just prefer to get something I know I wouldn't want to own due to cost considerations back in Singapore. Like a Porsche, an Audi, a Range Rover Sport, a Corvette, a Mustang, a Hummer H2 (or H3), an MB E55 AMG, a BMW 7-Series etc. That's right -- in this part of the world, you can literally afford to let your hair down and go with your heart because cars are generally much cheaper here than in Singapore. Up to 70% cheaper in some cases. Period.

Take a fully-loaded Evo X SST for example. It costs around SGD135k in Singapore, and at AED191k, that's SGD70k here

An Audi TT 2.0T FSI costs SGD180k in Singapore. An Audi TT 3.2 quattro costs AED187k here -- that's around SGD70k here.

A Lexus IS300 costs AED158k here. Not sure what it costs in Singapore now, but last time I checked, it cost SGD128k.

A VW Golf R32 costs AED150k here, SGD150k back home in Singapore.

I think you see the point already. And that's not even including road tax yet!

Of course, there's nothing wrong with buying a a Hyundai Tiburon Coupe, Toyota Camry, a Kia Sorento, a Mitsubishi Lancer, etc, but remember -- the world's running out of oil, and I wouldn't want to be looking back 20 years from now, wishing that I'd at least driven something truly glorious back when I *COULD* :)