Dubai has established itself as one of the most attractive real estate investment destinations globally, supported by a legal framework that provides clarity, security, and transparency for local and international investors alike. This guide examines the key legislation, regulatory requirements, and practical considerations that developers and investors must understand when entering the Dubai property market.
Understanding Foreign Ownership Rights in Dubai
The Legal Foundation: Law No. 7 of 2006
Prior to 2006, property ownership in Dubai was restricted to UAE and GCC nationals. This changed with the enactment of Law No. 7 of 2006, formally known as the Real Property Registration Law, which opened freehold ownership to foreign nationals in designated areas.
Regulation No. 3 of 2006 identifies specific freehold zones where non-UAE nationals can acquire full ownership rights. These include established communities such as Dubai Marina, Downtown Dubai, Business Bay, Palm Jumeirah, Jumeirah Lakes Towers, and Arabian Ranches. The 2025 regulatory updates have expanded these zones to include Dubai South, Al Wasl, Meydan, and additional areas along Sheikh Zayed Road. For a detailed overview of ownership eligibility, see our guide on 100% foreign ownership in the UAE.
Types of Property Ownership
Dubai offers several ownership structures, each with distinct characteristics.
Freehold ownership grants complete ownership of property and land indefinitely. Owners hold full rights to sell, lease, mortgage, or transfer their property without restriction. Freehold properties typically command a 20% to 25% premium over leasehold equivalents due to the security and flexibility they offer.
Leasehold ownership provides long-term use rights for periods up to 99 years. While leaseholders can occupy and use the property, they do not own the underlying land and must renew their lease upon expiry.
Usufruct rights allow the holder to use and benefit from property for a defined period, typically ranging from 10 to 99 years. This structure is common for international investors in certain developments.
Strata title ownership, governed by Law No. 27 of 2007, applies to individual units within jointly owned properties such as apartment buildings. Owners hold title to their specific unit while sharing ownership of common areas with other unit holders. Our strata law and community management practice provides guidance on these arrangements.
Regulatory Framework: DLD and RERA
Dubai Land Department
The Dubai Land Department serves as the primary authority for property registration and land matters in the emirate. DLD maintains the Real Estate Register, which assigns unique identification numbers to all properties in Dubai and records ownership details, encumbrances, and transaction history.
Key functions of DLD include:
- Registration of property ownership and issuance of title deeds
- Collection of transfer fees (4% of property value)
- Oversight of property valuation standards
- Processing of Golden Visa applications for property investors
- Maintenance of digital ownership records accessible through the Dubai REST app
Real Estate Regulatory Agency
RERA operates as the regulatory arm of DLD, established in July 2007 to oversee day-to-day market operations. RERA's mandate covers licensing, monitoring, and enforcement across the real estate sector.
RERA responsibilities include:
- Licensing of developers, brokers, agents, and property management companies
- Project registration and approval through the Trakheesi system
- Supervision of escrow accounts and authorization of fund releases
- Monitoring of construction progress on off-plan developments
- Enforcement of advertising regulations
- Maintenance of the Smart Rental Index (launched January 2025)
RERA has increased enforcement activity significantly in recent years. In 2024, the agency issued warnings to 23 brokerage firms, collected over AED 12 million in penalties, fined 256 brokers for advertising violations, and sanctioned 30 companies for unauthorized promotions. For the latest regulatory developments, see our UAE real estate laws 2025 overview.
Escrow Account Requirements for Developers
Legal Framework
Law No. 8 of 2007 established mandatory project-specific escrow accounts for all off-plan developments in Dubai. This legislation was introduced to protect buyers following market disruptions where some developers collected payments but failed to complete projects.
Under the escrow system, all buyer payments must be deposited into a RERA-approved escrow account held with a DLD-approved bank. These funds are ring-fenced and can only be used for the specific project for which they were collected.
Key Requirements
Developers must comply with several escrow-related obligations.
Initial deposit: Law No. 9 of 2007 requires developers to deposit 20% of the total construction cost upfront, either as cash or a bank guarantee, before commencing sales.
Fund usage: Escrow funds may only be used for land payments, construction costs, consultancy fees, and approved sales and marketing expenses related to the specific project.
Milestone-based releases: RERA authorizes fund withdrawals only upon verification of construction progress by independent inspectors. Developers cannot access funds based on calendar dates alone.
Reporting obligations: Regular reporting to DLD and RERA on all inflows and outflows is mandatory.
Failure to comply with escrow requirements can result in penalties of AED 100,000 or imprisonment under Article 16 of Law No. 8 of 2007. The escrow system has contributed to a 78% reduction in developer fraud since its implementation.
Off-Plan Sales Regulations
The Oqood System
Law No. 13 of 2008 established the Interim Real Estate Register, known as Oqood, which requires all off-plan sales contracts to be registered with DLD before developers can collect payments. This system prevents developers from selling the same unit to multiple buyers and provides purchasers with legal documentation of their interest.
Upon registration, buyers receive an Oqood Certificate confirming their purchase agreement. This certificate converts to a full title deed upon project completion and handover. For guidance on protecting yourself during off-plan purchases, see our article on red flags in Dubai off-plan property.
Developer Pre-Sale Requirements
Before marketing or selling any off-plan units, developers must satisfy several requirements:
- Register with RERA as a licensed developer (fee: AED 25,000)
- Register the project through the Trakheesi system (fee: AED 150,020)
- Obtain a RERA permit before any advertising or marketing
- Demonstrate land ownership through a valid ownership deed
- Open a project-specific escrow account
- Submit approved designs, expected delivery dates, and payment plans
- Provide a consultant letter, district cooling agreement, and NOC from the master developer
Off-Plan Purchase Document Checklist
Buyer Default and Contract Termination
Law No. 19 of 2017 established clear procedures for contract termination when buyers default on payment obligations. These provisions are matters of public policy and cannot be modified by contract.
The termination process requires the developer to notify DLD of the buyer's default. DLD then issues a 30-day notice to the buyer to remedy the breach. Only after this notice period expires and DLD verifies the default can termination proceed.
Developer retention caps depend on project completion status:
If RERA cancels a project, buyers are entitled to full refunds through the escrow account distribution process. For assistance with real estate disputes, consult a qualified legal professional.
Strata Law and Jointly Owned Properties
Ownership Structure
Law No. 27 of 2007, as amended by Law No. 6 of 2019, governs strata title ownership in Dubai. This framework applies to multi-unit developments such as apartment towers, villa communities, and mixed-use buildings.
Strata properties are divided into privately owned units and jointly owned common areas. Each unit owner holds individual title to their unit while sharing ownership of common areas proportional to their unit entitlement.
Owners Associations
An Owners Association is automatically constituted upon registration of the first unit sale in a jointly owned property. The OA operates as a non-profit entity with separate legal personality, capable of entering contracts, holding assets, and pursuing legal action.
Key aspects of Owners Association governance include:
Board of Directors: Elected annually by majority vote at the General Assembly meeting. The board oversees day-to-day management and engages property management companies.
Service charges: All owners contribute to the General Fund (covering operational expenses) and Reserve Fund (for capital maintenance) based on their unit entitlement. RERA regulates service charges through the Mollak platform, which benchmarks fees against market averages.
Management companies: Must be licensed by RERA and operate under a registered management agreement.
Developer Defect Liability
Developers remain liable for defects after project completion under both strata law and the UAE Civil Code:
- Structural defects: 10-year liability from the date of completion certificate
- Building installations: One-year defect liability for repair or replacement
For construction-related legal matters, see Dubai's new construction law 2025.
Rental Market Regulations
Legal Framework
Dubai's rental market is governed by Law No. 26 of 2007 and Law No. 33 of 2008, which regulate landlord-tenant relationships. The Rental Disputes Settlement Centre, established by Decree No. 26 of 2013, has exclusive jurisdiction over rental disputes.
Ejari Registration
All tenancy contracts must be registered through the Ejari system under Article 4 of Law No. 33 of 2008. Registration is mandatory for DEWA connection and provides legal protection for both parties. Unregistered contracts may not be recognized by judicial authorities.
Registration fees are AED 155 for online registration or AED 219.75 at a trustee center.
Rental Document Checklist
Rent Increase Controls
Rent increases are strictly regulated based on the RERA Rental Index. The Smart Rental Index, launched in January 2025, uses AI and real-time data to determine fair market values.
Permitted rent increases depend on the gap between current rent and market average:
Without proper notice, the lease renews automatically at the current rent. For related guidance, see our articles on early termination of tenancy contracts in Dubai and tenant's right to security deposit.
Eviction Grounds
Landlords can only terminate tenancies under specific circumstances defined in Article 25 of Law No. 26 of 2007.
During the tenancy term (with 30 days to remedy):
- Non-payment of rent within 30 days of written notice
- Unauthorized subletting
- Use for illegal or immoral purposes
- Causing damage that endangers property safety
Upon lease expiry (with 12 months notice via Notary Public):
- Demolition or major reconstruction requiring vacancy
- Personal use by landlord or first-degree relatives
- Sale of the property
Transaction Process and Costs
Property Purchase Steps
The standard property purchase process in Dubai follows these stages:
- Property selection: Identify property in a designated freehold zone
- Due diligence: Verify developer credentials and property title through RERA and DLD portals
- MoU execution: Sign Memorandum of Understanding with 10% deposit
- NOC acquisition: Obtain No Objection Certificate from developer confirming all service charges are paid
- Transfer meeting: Both parties attend DLD-approved trustee office
- Payment and registration: Pay purchase price and DLD fees; ownership transfers immediately
- Title deed issuance: DLD issues new title deed in buyer's name
For a step-by-step walkthrough, see our guide on foreigners buying property in Dubai.
Property Buyer Document Checklist
Transaction Costs
The 9% corporate tax applies only to companies with profits exceeding AED 375,000. For details on upcoming changes, see what the 2026 UAE tax changes mean for your business.
Golden Visa for Property Investors
Eligibility Requirements
The UAE Golden Visa program offers long-term residency for property investors. As of January 2024, the minimum down payment requirement was removed, expanding eligibility significantly.
10-year Golden Visa: Requires property investment of AED 2 million or more. Investors may hold one or multiple properties, and mortgaged properties qualify provided the bank issues a NOC and DLD valuation confirms the threshold value.
5-year visa for investors aged 55+: Requires property investment of AED 1 million or more.
Application Process
Applications are processed through the ICP smart portal. Required documents include:
- Valid passport with minimum 6 months validity
- Title deed or Oqood certificate
- DLD valuation certificate confirming property value
- Bank NOC (if mortgaged)
- Emirates ID (if applicable)
Total costs are approximately AED 9,684.75, covering medical examination, Emirates ID, and residency permit fees. Processing typically takes 10 to 15 working days.
Key Benefits
Golden Visa holders can:
- Reside in the UAE without employer sponsorship
- Sponsor spouse and children regardless of age
- Sponsor unlimited domestic helpers
- Stay outside the UAE for extended periods without visa cancellation
- Ensure family members retain residence status until permit expiry if the primary holder passes away
2025 Regulatory Updates
Several significant changes have taken effect or been announced for 2025.
Expanded freehold zones: New areas including Dubai South, Al Wasl, Meydan, and sections of Sheikh Zayed Road are now open to foreign freehold ownership.
Smart Rental Index: Launched January 2025, this AI-powered system provides more accurate and frequently updated rental valuations than the previous annual index.
Enhanced seller payment requirements: Effective June 2025, non-resident sellers must maintain UAE bank accounts. Payments must go directly to the title deed owner; payments to Power of Attorney holders are no longer permitted.
Automated Owners Committee registration: The registration process for Owners Committees became fully automated in January 2025.
Stricter developer oversight: RERA has increased monitoring of construction timelines and escrow usage by 35%, with heavier penalties for non-compliance.
Frequently Asked Questions
Can foreigners buy property in Dubai?
Yes, foreign nationals can purchase freehold property in designated areas under Law No. 7 of 2006. Over 30 zones are open to foreign ownership, including Dubai Marina, Downtown Dubai, Palm Jumeirah, Business Bay, and Jumeirah Lakes Towers.
What are the costs of buying property in Dubai?
The primary cost is the 4% DLD transfer fee. Additional costs include trustee office fees (AED 2,000 to 4,000), title deed issuance (AED 250 to 580), and agent commission (typically 2%). There are no annual property taxes or capital gains taxes.
How does the escrow system protect off-plan buyers?
All payments for off-plan properties must go into a RERA-supervised escrow account. Funds can only be released based on verified construction progress, and developers cannot use funds for other projects. If a project is cancelled, buyers receive refunds from the escrow account.
What is the minimum investment for a Golden Visa?
Property investors need AED 2 million in real estate to qualify for a 10-year Golden Visa. The property can be mortgaged, and multiple properties can be combined to reach the threshold.
How are rent increases regulated in Dubai?
Rent increases must follow the RERA Rental Index and range from 0% to 20% depending on how far below market rate the current rent is. Landlords must provide 90 days notice before proposing any increase.
What happens if a developer defaults on an off-plan project?
If RERA cancels a project, buyers are entitled to refunds from the escrow account. For stalled projects, Decree No. 33 of 2020 established a Special Tribunal to resolve disputes and determine appropriate remedies.
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