property law


July 12, 2015



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Rent cap

I believe that all legislation since 2006 have boosted the confidence of homeowners in Dubai.

However, the amendments in the tenancy law, Decree 43/2013, have been a landmark legislation that encouraged investors to invest and make profit while renting out their properties without interfering on the rights of the tenants.

The new decree provided a cap on rental increase upon the renewal of the tenancy lease.

The increase is now dependent on the rental index of a particular area which is brought out by the Real Estate Regulatory Agency (RERA).

Escrow law and off-plan properties

The escrow law introduced in 2007 is an effective safeguard for investors if applied in a proper way.

According to the existing legislation, an escrow account or a guarantee account will be opened by the developer of a real estate project.

All the money collected by the developer from the homeowners and the financiers of the project will be deposited in this account, and this money can be used only for the purposes of constructing the real estate project.

Money from the escrow account can be used to make payments for the land, contractors, consultants and marketing-related activities for the specific project.

However, not all expenses spent by the developer of the project can be paid from the escrow account. Only 5 per cent of the total sales amount can be used for marketing the project.

Inheritance law

The new Wills and Probate Registry at Dubai International Financial Centre (DIFC), which is still under discussion, will make it possible for non-Muslim expatriates who own properties in Dubai to register their will.

This allows them to transfer their assets to anyone according to their wishes and will not be guided by the Shariah laws.

It is another big step to boost investment in the real estate sector.

On purchasing a commercial property

When buying a freehold commercial property, check the reputation of the developer and its track record of finishing projects on time. Ensure the handover date is fixed. Study the sales and purchase agreement (SPA), ensuring your allotted area is mentioned and you are entitled to use the common areas.

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Dear Sir, I have some money and want to purchase one apartment/ villa but here many times I heard like " Dubai properties only for years ours after UAE government will be took back " is correct or If I want same property how much govt collect money from for that same proporties. Please clarify. Thanks.
Purchasing a property is a commercial and a personal decision, which you may need to take in light of informed legal advice. It is critical to review all the property purchase documents including the title documents, and sale-purchase agreements before purchasing a property. Accordingly, you may need to take legal advice from a lawyer who will review your documents to guide you on your legal position. If you would like to schedule a meeting to discuss your matter, please let us know and we will be pleased to render our legal assistance to you.

Should you have any questions, please do not hesitate to contact us.   Dr. Hassan Elhais

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