Real Estate News – Property ownership in the UAE

Ownership of land and property in the UAE falls under the jurisdiction of individual emirates. Sharjah was the first emirate bestow ownership status on GCC and Arab expats, excluding non-Arab residents. The emirates of Umm Al Quwain, Ajman and Fujairah are expected to issue new property laws as some developers are offering freehold ownership to the expatriates already.

Abu Dhabi, Ras Al Khaimah and Dubai have already enacted new real estate laws, relevant in their respective emirates. However, it was Dubai that revolutionised the concept of foreign ownership of land by granting freehold and leasehold status to both Arab and non-Arab residents in 2002. In the absence of a definite real estate law, the three master-developers, Emaar, Nakheel and Dubai Holding were authorised by the government to sell freehold assets.

Until last month, a formal contract governed the terms of the deed, backed by the government guarantees extended to the three developers. Dubai government's promulgation of the property law (Law No.7) will change that and legalise the ownership. The law says, the government will identify certain locations where expatriates will be allowed to own properties in their names, on (1) 99-year lease and (2) on freehold. The government is expected to issue new bylaws to regulate the market and determine the buying, selling procedures, fee structure and ensuring best practice.According to Law No. 7 the buyer negotiates with the developer or broker on price and payment schedules. He signs a Purchase Contract containing the terms and conditions, including payment structure, delivery date and fines in case of late payment by buyer or late delivery by developer. Until recently, the Purchase Contract was the most vital document determining the buyer’s ownership right. The investor can sell the property, after settlements on pricing, through the developer who transfers the ownership by giving a new Purchase Contract for the new buyer.

Currently, no government authority decides on the value of the surface property (villas/apartments). It is determined by individual market study. If a dispute arises, the home owner can approach the courts, without seeking arbitration unless it is specified in the Purchase Contract. The property assets will be registered with Property Register at the Dubai Land Department after completing the formalities of payment of fees.The buyer gets the Title Deed in his name, which will be initially processed and handled by the developers-Nakheel, Emaar and Dubai Holding subsidiaries.Thus the Land Department-registered Title Deed becomes the base document for ownership. The secondary purchase and sale will have to be managed by the homeowner himself.Dubai Land Department will evaluate the land price/property value that will be the benchmark for both buyer/seller. It is developing and expanding its property evaluation unit, which till recently conducted land valuations only.

Article from - www.gowealthy.com