A Legal Guide to Real Estate Purchase in Dubai

A Legal Guide to Real Estate Purchase in Dubai

With the sudden rise in real estate purchases in Dubai, buyers have been reluctant or hesitant as they want to know the clear laws on property owning in Dubai for Expatriates and Developers selling these properties.


When buying apartments in Dubai, are rent-to-own schemes legal? Could you explain the laws around buying real estate apartments? For instance, what happens if I pay half the amount and am unable to pay the rest after signing a contract? Do I lose the money I paid?


Pursuant to your queries, the provisions of Law No. 19 of 2017 Amending Law No.13 of 2008 Regulating the Interim Real Property Register in the Emirate of Dubai (the ‘Amended Interim Real Property Register Law 2017’); those of Law No. 7 of 2006 concerning Real Property Registration in the Emirate of Dubai (the ‘Dubai Law No. 7 of 2006 on Real Property Registration’); and those of Law No. 14 of 2008 Concerning Mortgage in the Emirate of Dubai should (the ‘Dubai Mortgage Law’) are applicable.

In Dubai, some developers provide rent-to-own property schemes, wherein purchasers may pay the initial down payment in the form of installments for a few years like rent on monthly or quarterly basis or during relevant intervals. After completion of the rent-to-own scheme, the purchaser should pay the remaining amount to the developer.

Article 4 of the Dubai Law No. 7 of 2006 on Real Property Registration states:

"The right to own Real Property in the Emirate shall be restricted to UAE nationals, nationals of the Gulf Cooperation Council States, companies fully owned by these nations, and public joint stock companies. Subject to the approval of the Ruler, non-UAE nationals may be granted the following rights in the relevant areas determined by the Ruler:

a. Freehold ownership of Real Property, without time restrictions; and

b. Usufruct or lease rights in Real Property for up to ninety-nine (99) years."

A purchaser in Dubai may also utilize the provisions of Dubai Mortgage Law, where he or she may avail mortgage on the property which he or she intend to purchase, or which is already purchased.

Further, if the purchaser is not able to pay all the installments on the property, he/she may or may not be entitled to receive part of the amount paid to the developer based on the percentage of completion of the property. Article 11 of the Amended Interim Real Property Register Law 2017 explains the obligations of the purchaser and the developer in the event of breach of contractual obligations.

The developer should first notify the Dubai Land Department (DLD) about non-performance of contractual obligations by the purchaser. Thereafter, the DLD notifies the purchaser, asking him/her to fulfill contractual obligations as per the sale purchase agreement within 30 days. In the event the purchaser does not fulfill the obligations within such period, the DLD may allow the developer to complete the relevant requirements of transferring the property to its name. The developer may pay back to the purchaser part of the purchase price, if any amount is due.

News Source: Khaleej Times

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