has emerged as a wondrous world,
offering a multitude of attractions,
an inevitable sense of security
and above all the overall ambience
that triggers energy and excitement.
It is no wonder why more and more
people are opting to settle down
in Dubai or to pay a visit to this
culturally strong and hospitable
part of the world.
as one of the most expensive cities
of the world, Dubai still is a magnet
that attracts rather compels people
to take a bite of its suaveness.
In 2001 Dubai Property Market changed.
The government agreed to allow foreign
investors and buyers to take 99-year
leases on apartment and villa property
in Dubai. At the time when this
law was passed in 2001 the population
was close to 1 million people. In
May of 2002, the crown prince of
Dubai, Sheikh Mohammed bin Rashid
Al Maktoum, stated that Dubai would
allow foreign investors to buy Dubai
properties on freehold ownership.
The statement just jumpstarted the
market and it has been booming ever
Now during last
three years Dubai has emerged as
the ultimate destination for international
and local property investors. The
boom was triggered by the ‘freehold
property scheme’, unveiled in 2003
by Dubai government, allowing foreigners
to own property for life, with the
right to sell, lease or rent it
at their own will. Along with this,
the increase in population, flourishing
tourism and readily available mortgage
facilities from banks and financial
institutions have given vent to
an extraordinary real estate boom
in Dubai. Real estate projects of
almost $30 billion are currently
under development in Dubai.
Since the new laws
were passed, capital growth in Dubai
has been on the up and capital growth
that exceeds 20% is expected as
Dubai continues to nurture its attraction
to be the NO1 tourist and leisure
country. This coupled with achievable
8% rental income return; it is clear
why Dubai is considered one of the
top investment property hot spots
In the case of Dubai and the UAE,
property law is very young and still
taking its long-term shape, although
the key elements are straightforward
to understand. The Law No. 7 that
legalizes freehold ownership of
land and property for UAE and GCC
citizens, while allowing the same
rights to non-GCC expatriates to
pre-designated areas that will be
approved by the Ruler of Dubai.
expatriates will be given the right
to acquire freehold and 99-year
lease property, in areas designated
by the Ruler. The law comes almost
four years after the government
first announced freehold ownership
to expatriates, grouped under three
Dubai-government owned entities
Emaar Properties, Nakheel and Dubai
Properties. The new property law
entitles the investors and buyers
to the following clauses:
* The foreigners will have the right
to lease or purchase the land, after
getting approval from the three
master-developers, Emaar, Al Nakheel,
and Dubai Properties.
A land will be registered in the
name of a foreigner only after the
developers submit a no-objection
letter, stating that all the payments
for the transaction have been made
There are three kinds of ownership
proposed in the legislation: freehold,
usufruct, and common hold. The owner
will have complete ownership rights
over a free hold property and the
building in this case will be in
the owner's name.
* The second category is usufruct
or long-term lease. The law characterizes
'usufruct' as the right to use another's
property short of destruction or
waste of its substance. The right
of usufruct, as per the law, should
not be for less than five years.
This will most probably be a long-term
lease whose maximum validity period
will range from anywhere between
50 to 99 years
Common-hold allows leaseholders
to dispense with their landlord
and obtain a share of the freehold.
* The registration
fee for the transaction will be
two per cent of the total value
of the property, of which 1.5 per
cent has to be paid by the purchaser
and the rest by the seller. After
the payment of the whole amount,
the owner is free to either bequeath
the property or sell it.
* The most important
and probably extremely consequential
component of the law is the clause
that those who already purchased
property will have to legalize their
purchase by registering it with
the authorities. Another important
feature of the law is the recognition
of the land development lease.
* The confidence
of the investors and buyers as the
new Dubai property law ascertains
on them the 100% foreign ownership
for the expatriates. More banks
will begin the facility of home
finance as there is a guarantee
in the ownership of the properties.
* The law also specifies
the functions and responsibilities
of the Department of Land and Property,
which has so far been doing all
the work by virtue of practice,
sans legal clarity. As per the law,
the department will determine the
survey areas; approve the land map
and the fees for the services provided
by the department.
from Law No.7 of 2006
Provisions of this law are applied
to properties located in Dubai.
The right to own properties within
the Emirate shall be limited to
UAE and GCC citizens, to the companies
wholly owned by them, as well as
to the public stock companies. Pursuant
to the Ruler’s consent, non-UAE
nationals may be granted the following
rights in designated areas:
a) Freehold ownership
of the property for an unlimited
b) Usufruct over the Property or
99-year lease thereof.
The original documents and judicial
rulings upon which properties are
registered are to be kept at the
Lands and Properties Department.
It bans the removal
of documents from the department.
Judicial bodies or any expert or
committees assigned are authorized
to review the documents and get
The Lands Department is solely assigned
to register property rights and
long-term leasing contracts as stipulated
in Article No.4 of this law.
Under the law, the
department will carry out the following
1- Specifying survey
areas or re-conducting surveys and
attesting location maps.
2- Specifying rules related survey
and releasing maps related to property
3- Preparing model property contracts.
4- Setting rules related to regulating,
keeping and destroying documents.
5- Setting rules related to the
use of Computer in data entry and
6- Setting rules related to the
regulation and keeping the records
of property brokers.
7- Setting rules related to the
assessment of properties.
8- Setting rules related to the
sale of properties in auctions,
and supervising the auctions.
9- Fixing fees for services offered
by the department.
10- Setting up branches of the department
upon the director’s discretion.
A property register at the Dubai
Lands and Properties Department
shall be set up for documenting
property rights and their amendments.
Its records hold the ultimate evidence
against all without exceptions.
Its records cannot be challenged
except in the case of forgery.