How Can I Buy Property in Dubai without Facing Legal Issues?

Real estate investment is the most popular form of investment for most people. As human beings we want to see the value of our purchase with our own eyes. Real estate can be used for both commercial and private purposes such as a business site or as a residential home respectively. However, as an expatriate in the United Arab Emirates, purchasing and using real estate can a complex process that requires several steps. Let us go through these steps to see how you can buy real estate and avoid any issues arising from this business transaction.

Steps of Buying Real Estate in the UAE

  1. Understanding your purchasing position as an expatriate: can you legally buy real estate?

Many individuals and businesses just assume that having the funds to purchase a property is enough to qualify as a potential real estate owner. However, have you ever really investigated the requirements to even be eligible according to the UAE’s law? There are some unique legal statutes that govern who can own land and who cannot purchase real estate. The Property Ownership Law or the Law No. 7 of 2006 is the specific law that governs the eligibility of real estate owners be it businesses or individual people. However, the free zones such as the Dubai International Financial Centre have their unique property laws. The UAE nationals and their companies are allowed to own land anywhere in the Emirate. However, companies that have non-UAE shareholders are not considered to be a UAE OR Gulf Cooperation Council unless they are public joint stock companies.

However, non-UAE nationals have the right to own a long lease, musataha, freehold titles, or usufruct as long as they are given permission by the Ruler of Dubai. The usufruct is only legal for 99 years so that non-UAE nationals can only own real estate in specially selected areas. It is crucial to understand your position as an expatriate either individually or as a business in order to identify the areas where it is legally feasible to own land in the UAE. The main bodies charged with enforcing these laws include the Dubai Land Department and the Real Estate Regulatory Agency.

  1. Complete all Dubai Land Department real estate purchasing procedures.

The DLD is the most important body in real estate and land in Dubai. This organization decides which individuals are eligible to become real estate owners in the country. It also determines when and how real estate can transfer ownership therefore being the main association dealing with land matters in Dubai. Completing all due process with the DLD can allow you own your real estate or procure your lease without incurring legal impediments. Any aspiring or current real estate owner who is not a UAE national should ensure that they continuously check with the DLD to ensure that any updates or changes to the policies do not affect your current contractual agreements.

  1. Find areas where you can own real estate.

There are areas named as the ‘designated’ areas where non-UAE individuals may own real estate or have their leases. These areas include the Palm Jumeirah, Burj Khalifa, Dubai Marina, Discovery Gardens, The World Islands, and International City among others. These areas are then open for use by non-UAE expatriates who have made real estate investments in Dubai.  However, a caveat of the rules concerning the real estate ownership in these areas is that non-UAE nationals and their businesses can include a free zone company in Dubai but must register the real estate only in the name of the company created.

  1. Ensure that all documentation is legal and real.

Before purchasing any piece of real estate, it is crucial to verify the ownership with the seller and determine whether they have the authority to sell off a particular piece of real estate. It is also essential to view the original title deed of any land plot and also determine whether the project is active or not.

  1. Purchase Process

To purchase a land plot in the UAE, the process is fairly simple once the non-UAE/GCC national has identified a suitable piece of land that fulfills the legal requirements. Essentially, for non-UAE nationals looking to purchase, the designated areas are usually still in development as such, the areas where they may be interested in purchasing are usually under the control of a master developer or a sub developer. The process includes paying the deposit for the real estate after approaching the developers and paying a typical percentage of the sales price. The seller can then proceed to change the title deed depending on whether or not they receive a non-objection certificate for the piece of land.

Hazards Associated with Buying Real Estate in the UAE

The hazards of buying land in Dubai can be very costly to a first time buyer. It is crucial to research and ensure that the piece of land has been acquired legally both on your part as the buyer and on the part of the seller. By following these steps, you can avoid hazards such as legal troubles concerning land ownership as well as avoid unscrupulous individuals who may sell land that is not for sale to unsuspecting buyers.

DISCLAIMER: While every effort has been made to ensure the accuracy of this publication, it is not intended to provide legal advice as individual situations will differ and should be discussed with an expert and/or lawyer. For specific or legal advice on the information provided and related topics, please contact us.

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