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dubai real estate laws
25th June 2012

We all know that Dubai is the most well-recognised city in the United Arab Emirates. Due to modern advancement in architectural structures and buildings, it was considered a resort city of the Middle East. World’s rich travelers consider visiting Dubai due to luxurious accommodation it offers to the visitors and travelers. Nowadays, buyers and investors from all over the world are taking interest to buy Dubai property. Dubai State Government has designed and implemented a few Dubai property laws for real estate buyers and investors across the world. These rules and regulation address many legal issues related to selling, buying and owning Dubai property.

Since 2002 when expats were allowed to buy a property with freehold rights, Dubai has come a long way. As one of the UAE’s most comprehensive real estate websites focussed on empowering people with the resources they need to make informed property decisions, we at Betterhomes Dubai, help consumers find their next home. We do this by offering the latest property listings in the market alongside relevant and accurate data, local information and search tools. When Betterhomes started in 1986, our service only included residential leasing. Since then, our service portfolio has expanded significantly to include residential sales, commercial sales, commercial leasing, property management, and short-term rentals.

dubai real estate laws

Search for new houses, flats, and developments across the UAE at Betterhomes Dubai. At Betterhomes, everything we do is aimed at making the market more efficient for consumers and advertisers alike. This has made us one of the fastest growing companies and websites in the Region, now attracting millions of visits per month. Betterhomes Dubai mission is very simple– to be the most valuable online resource for consumers and online partners for real estate professionals.

Since the 2008 global downturn, Dubai’s property market has transformed significantly. More regulation has kicked in, both in the regular and off-plan sales model, with the market experiencing growth in terms of prices, transaction volumes, equity, and rental yields. Dubai Land Department, which has increased property registration fees to discourage speculation, has indicated that more laws to curb flipping are likely to be announced. Strategically located between Asia, Europe, and Africa, Dubai is a worldwide investment hub and amongst the world’s mature and fastest growing property markets. The upcoming World Expo 2020 will further enhance Dubai’s status as an investment destination as buyers and corporates from all the world homes in the city.

Most legislation since 2006 has boosted the confidence of property investors in Dubai. For instance, amendments to the tenancy law has encouraged property owners to invest and make a profit while renting out their properties to tenants. The new decree has also provided a cap on the rental increase, dependent on the rental index of a particular neighborhood, which has been set by the Real Estate Regulatory Agency (RERA).

The escrow law introduced in 2007 has also been an effective safeguard for investors. According to this law, all the money collected by the developer from the homeowners and project financiers will be deposited in this account. Further, the money can be used only for the purposes of constructing the development.

Who can buy Dubai Property?

Buying an asset in this city used to be a very complex process for foreign investors and buyers. During past years, the government doesn’t allow foreigners to buy the freehold of Dubai properties. Due to the great interest of foreign investors in Real Estate Dubai the Crown Prince of Dubai named Sheikh Mohammed bin Rashid al Maktoum, announces a new Dubai property law that enables foreigners to freehold leases of Dubai property for the unlimited time period. They get permission to apply for 10 to 99 years leases in specific areas. These freehold rights are very similar in nature like property ownership rights in other countries. Foreigners who obtain freehold rights can use their assets forever. Moreover, they are allowed to transfer their rights to another person. The beneficiary of freeholders are entitled to asset upon the death of freeholder. In order to possess a freehold for properties in specific areas, buyers have to get approval from the ruling government. But areas that already get approval for foreigners, any individual or foreign company will be eligible to hold Dubai Property.

Why a Buyer or Investor must be Aware of Dubai Property Laws?

Buyers and investors around the world show great interest in buying Dubai property even they will receive provisional legislative proof against their huge investment in real estate Dubai. Due to the absence of legal verification buyers must know primary Dubai property laws in order to make safe deals. A residential permit to live in the United Arab Emirates is required to make any residential or commercial property purchase. Getting a residential permit to live here does not allow foreigners to work here. Unlike other countries documental verification is not performed on asset purchase in this city. Buyers only need to sign a contract paper for making property deals. Usually, buyers are required to deposit 10-20% of the total asset price. If you are going to make a purchase deal in newly constructed project you will have to make payments in installments. In the purchase agreement in Dubai, you can transfer the amount to the third party or vendor. If a buyer is making payment via vendor he needs to pay 2% of the total property price as a fee to the vendor.

Dubai Property Laws

Dubai is the most populated and well-known city of the United Arab Emirates (UAE). Dubai economy is not based on oil, rather this place derives its major income from real estate, tourism, and financial services. Dubai property market used to be the fastest-growing industry, but the recent global financial crisis also affects property development badly. Eventually, asset prices fallen down, and buyers and investors get good chances to make good deals. For buyers, this is the best time to purchase a Dubai Property. In order to make a successful purchase deal every buyer must know specific laws that talk about buying, ownership, and selling of Dubai properties. The following are the three major Dubai property laws that every buyer or seller must understand.

Real Estate Law Number Seven

Real Estate Law Number Seven was passed in 2006 by the Estate Government of Dubai. This law reduces the restriction on foreigners related to property ownership in Dubai. According to UAE estate laws, the foreigner was not allowed to hold ownership of land and building properties in Dubai. After the implementation of this Real Estate Law, number Seven, foreigners or nonresidents can obtain property ownership on rent or lease. The duration of property lease for any property is around 99 years that must get approved by the State Government of Dubai.

Rental Property Laws

For rental properties in Dubai like apartments and residential properties, the tenant contract is usually signed for one year if not it will be specified in the written contract. Landlords are not allowed to increase rent. Rents can be raised when the lease finished and it’s time to renew it. Moreover, landlords are not allowed to raise the rent of more than 15%. In case of any dispute between renter and homeowner, they need to file a case to the municipality’s rent Control Committee. The panel will hear the dispute and make a judgment accordingly. Tenant and homeowner will have to obey the decision made by the panel.

Inheritance Property Law

This law is quite complex as compared to other Dubai property laws. If a deceased asset owner holds membership of other nation then inheritance law of UAE also consider the law of other nation. It becomes more complex to decide inherited owners if a homeowner holds dual citizenship of two countries other than UAE. A valid will that fulfills all the legal standards of UAE and Dubai is essentially required to assign estate to legal beneficiaries. In the absence of a legal will, it is an Intestate Court decides how a property should be divided among recipients or state will owe that property. That’s why foreign investors and buyers investing in real estate Dubai must have a valid will to save their assets for their families.


Dubai property laws are very important for local and foreign buyers and investors. Anyone who is going to sell, purchase or rent any kind of property must follow these Dubai property laws. This will help them to take full advantage of their assets in Dubai. Rather they can also transfer their property ownership to their siblings or family.

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