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  • Writer's pictureAkram Cheik - Lawyer

Legal guide for real estate purchases in Dubai: what you need to know before buying

This guide is dedicated to real estate transactions in Dubai, a fruit of several years of experience and legal expertise in the field of disputes to the Emirates. As a leader in the real estate sector, our goal is to provide you with in -depth information on the legal aspects surrounding the purchase and resale of real estate in Dubai.


It is important to emphasize that this article is not intended to provide financial or investment advice. Our expertise is based on in -depth knowledge of legal litigation linked to real estate transactions in Dubai. We do not pretend to be financial advisers, but we provide you with precious information from our experience and our in -depth understanding of the legal challenges that the parties involved may be confronted.


This guide is intends to be a resource - not exhaustive - for people considering real estate transactions in Dubai, offering practical advice based on years of practice and analysis of disputes. It aims to make readers aware of the many legal issues they could face, thus preparing them to make informed decisions during their real estate transactions in this dynamic region.

We encourage you to use this guide as an information tool to understand the legal inspection and residents of the real estate market in Dubai, without forgetting that in support of this guide you can always contact us.


However, for specific financial advice, it is recommended to consult a qualified professional in this area. We hope that this guide will be useful to you in your real estate career in Dubai, giving you an in -depth legal perspective to make informed decisions and minimize potential risks.

The first part is devoted to the purchase (Party I) of a property, the second to the resale of the property (Party II).


Part I: Everything you need to know about the purchase.


Chapter 1: Promoter choice

A - Promoter reliability

B - Duration of possession of the land.

C - History of delivery delays.


Chapter 2: Purchasing purchases.

A - Detailed analysis of plan purchases.

B - Problems related to delays in payment and construction.

C - Legal protection for buyers.


Chapter 3: Reservation and withdrawal.

A. Distinction between reserving a good and showing interest.

B. Precautions during booking payments.

C. withdrawal and its implications.


Chapter 4: apartments in hotels.

A - Specific contractual conditions.

B - Attentive reading of contracts.


Chapter 5: Selection of the real estate agent

A - Criteria for choosing a reliable real estate agent.

B - Verification of recording and legitimacy.

C - Importance of the promoter's sequestration account.


Part II: Everything you need to know about resale.


Chapter 6: Banking constraints for non-residents

A - Specific precautions for international transactions.

B - Purchases in terms of international context

C - Hotels apartments in an international context


Chapter 7: Obtaining the NOC for resale.

A - Banking limitations for non -residents.

B - Obtaining the NOC (NO objection certificate) for resale.

C - Preparation of resale and contractual considerations


Chapter 8: Reasons for refusal of the night and legal consequences.

A - Payment backwards

B - Specific contractual clauses.

C - Disputes in progress.


Chapter 9: Conclusion.



Part I: Everything you need to know about the purchase


Chapter 1: Promoter choice


A - Promoter reliability


When you assess the reliability of a promoter for your real estate investment in Dubai, it is essential to take into account several crucial aspects.


Promoter's history:

The promoter's previous projects are indicative of their reliability. By analyzing the quality of these projects, their completion within the time limits, as well as the general satisfaction of customers, you will get a precious overview. In addition, this analysis will also allow you to realize the progression or regression of certain promoters.


Certifications and awards:

The certifications and the awards obtained by the promoter can be indicators of their commitment to excellence. These recognitions can testify to the quality of their work and their compliance with industry standards. However, it is also necessary to show distancing by checking whether there is no proximity between the authority that issues and the promoter.


Reputation on the market:

The promoter's reputation on the real estate market, both local and international, is crucial. A solid reputation is often synonymous with

Effective management, successful projects and lasting relationships with customers. Indeed, this reputation can also be corroborated by internet opinions of customers.


B - Duration of possession of the land


The duration of possession of the field is an important element to understand, because it can influence the long -term value of your property.

99 -year -old contracts:


The concept of 99 -year -old land possession contracts, frequently used in Dubai, deserves an in -depth understanding. It is essential to weigh the advantages and disadvantages of this duration of possession for your specific investment. Indeed, if in principle certain zones have been released specifically by the government for promoters it happens that certain zone is not, so the promoter can be forced by a time limit we strongly recommend this kind of project.


Long -term property implications:

Consider the long -term implications of the duration of possession of the field on the potential resale value of the property. In this perspective, it may be useful to consult professionals in the sector for personalized advice.


C - History of delivery delays


The management of delivery times is crucial to guarantee the success of your real estate investment. Explore the history of the promoter's delivery delays to better assess this dimension.


Analysis of previous projects:


An in -depth analysis of the history of delivery delays in previous projects of the promoter offers a perspective on its reliability. Identify the underlying causes of these delays, whether financing problems, construction complexities, or other factors. Indeed, it happens to see unfinished projects or with several years of delays, some promoters are customary because.


Contractual guarantees:


During the purchase contract review, pay particular attention to the clauses related to delivery times. Look for guarantees or penalties in the event of unjustified delays, thus strengthening the responsibility of the promoter. Thus, this contractual part is of extreme importance, it is necessary to rely only to the contractual clauses and not to the word of a real estate agent which can on the one hand showing himself in bad faith, on the other hand it happens that The latter do not master sales contracts (SPA).


Reputation of the promoter in terms of deadlines:

Ask other buyers about the promoter's reputation concerning compliance with deadlines. Also consider the promoter's responsiveness to delays, as well as its transparency in communication with customers. Indeed, with regard to transparency it is important to follow the opinions, it happens that some promoters no longer communicate about the project, or see the payment plan. Even provoking delays in payment in order to obtain the benefit of fines of delays. Ex: A promoter refuses a transfer of a client and then does not respond to the customer, causing penalties of delays.


Thus, by assessing these aspects, you will be better equipped to make an informed decision when choosing a promoter in Dubai, thus establishing solid bases for your real estate investment.

 

 

Chapter 2: Purchases on plan


A - Detailed analysis of plan purchases


When you plan to purchases in terms of Dubai, an in -depth understanding of this process is essential to make informed decisions.


Concept of Purchasing Purchases:


Purchasing purchases involve the acquisition of a property before its complete construction. This method offers the possibility of securing a good at an advantageous price, but requires in -depth understanding of potential risks. Indeed, if the advantages are no longer to be mentioned, it is necessary to understand the risks linked to a delay in payment or to a hazard preventing from going to the end of the payment.


Associated advantages and risks:


Explore the advantages, such as preferential prices and the possibility of personalizing certain elements. However, also take into account potential risks such as construction delays, unwanted changes and fluctuations in the real estate market.


B - Problems related to delays in payment and construction


Delays in payment and construction are current challenges associated with plan purchases. It is crucial to understand these issues to minimize risks.


Payment delays:


With regard to payments of payments, the latter are contractually penalized in the SPA (sales contract) if the Dubai Land Department court offers a means of protest, it is generally pronounced for an amicable arrangement, however below A threshold on average 35% payment if the buyer can no longer pay the promoter will ask to recover the property in order to resell it. From then on, you should be sure before committing.


Impacts of construction delays:


Construction delays can result from various factors, such as unfavorable weather conditions, material supply problems, or technical complications. Understand how these delays can influence the delivery schedule and contractual commitments. Thus, the SPA often provides compensation by the promoter, it is advisable to be attentive to these figures which can sometimes be minimized.


Legal protection for buyers:


Examine the laws and regulations in force in Dubai which offer protection to buyers in the event of unjustified delays. Understand the legal remedies available to ensure the compliance of the promoter.


C - Legal protection for buyers


Faced with potential challenges related to plan purchases, it is essential to understand the legal protections available for buyers.


In case of bankruptcy:

In the event of the promoter's failure, the DLD (Dubai Land Department) has a legal liquidation section set up when a project is canceled by the promoter, therefore this section aims to recover the amounts deposited in the account sequestration of the promoter in order to donate the amount to the DLD trust account so that it takes care of returning to the beneficiaries, either in whole or in proportion or according to the amount available on the account, the money of buyers .


Legal appeal in the event of non-compliance with the contract:


In the event of non-compliance with the contract, it is imperative to enter a lawyer to request any compensation: this may include financial compensation, contract cancellations in order to obtain total or partial reimbursement, or other solutions to protect buyers' rights.


Contractual transparency:


Insist on contractual transparency during negotiation. The contracts must clearly detail the payment deadlines, the penalties in the event of delay, and the measures taken in the event of non-compliance with the commitments.


By deep understanding the purchases on plan and associated challenges, buyers will be better equipped to navigate in this complex process and make informed decisions.

 

 

Chapter 3: Reservation and withdrawal


A. Distinction between reserving a property and showing interest


When you are considering a real estate transaction in Dubai, it is crucial to understand the difference between reserving a good and manifesting interest.


Formal reservation:


The formal reservation undertakes the buyer to acquire the property. This is a serious step where payments can be made to secure the property. To do this, it is necessary to settle the details of this commitment through a before contract mentioning the commitments of the two parties.


Expression of interest :


The simple manifestation of interest indicates a potential interest in good, but does not imply a formal commitment. No significant payment is generally required at this stage. Therefore it is necessary, one must be attentive to this distinction at the risk of not being able to retract and lose the sums engaged.


B. Precautions during booking payments


Performing reservation payments requires a cautious approach to avoid future complications.


Secure payment terms:


Advise the use of secure payment terms such as bank transfers rather than less transparent methods. Indeed, it is not recommended to make cash deposits except to have everything in a before contract indicating the nature of the commitment.


Verification of contractual terms:


Before any payment, carefully check the terms of the reservation contract. Make sure to understand the refund conditions in the event of withdrawal, because in many cases the withdrawal conditions are not provided for by the promoter?


Clear communication with the promoter:


Establish a clear communication with the promoter on the reservation methods and make sure to receive written documentation from agreed agreements.


C. withdrawal and its implications


The withdrawal in the context of civil law in Dubai requires in -depth understanding to avoid undesirable implications.


Complexity of withdrawal:


Explain the complexity of the concept of withdrawal in civil law in Dubai. It is essential to understand that this notion can differ from practices in other jurisdictions.


Tips to minimize risks:


Offer advice on how to minimize the risks linked to withdrawal, such as prior clarification of contractual conditions and understanding possible financial consequences.

Transparency in transactions:


Check transparency during real estate transactions. Promoters and buyers must communicate clearly to avoid misunderstandings and disputes.


By clearly understanding the difference between reserving a good and showing interest, as well as the precautions to be taken during booking payments and withdrawals, buyers can navigate more serenely in the preliminary phases of a real estate transaction in Dubai.

 

Chapter 4: apartments in hotels


A - Specific contractual conditions


The apartments located in hotels have specific contractual conditions which require in -depth understanding to avoid future complications.


Analysis of contractual clauses:


The careful analysis of the clauses specific to these contracts is crucial. This includes the rights and responsibilities of the owner, management rules by the hotel, and any restrictions on the use of the property.

Indeed, with regard to hotels the applicable rules are different, including rental scales, but also in some cases management which sometimes must remain the exclusivity of the hotel owner. As such, the latter provides for a remuneration for its service, but also predicted to pay the tenant according to the occupancy rate of the hotel/apartment chamber.


Negotiation of favorable conditions:


It may be possible to adjust certain terms to better correspond to the expectations of the buyer, therefore do not hesitate to ask to make a contract review in order to request the modification of certain clauses.

Transparency on the benefits generated:

Make sure that the contract offers transparency on how the profits generated by the operation of the apartment will be shared between the owner and the hotel.


B - Attentive reading of contracts


The careful reading of the contracts is crucial to avoid surprises and fully understand the commitments.


Law consultation :


For this type of contract, it may therefore agree to initiate negotiations or the consultation of a law of law for an in -depth understanding of the legal implications of the terms of the contract.

If some clauses seem ambiguous, encourage immediate clarification with the promoter or the legal representative. This can avoid future misunderstandings.


By understanding the contractual conditions specific to apartments in hotels, management by the hotel, and the need for careful reading of contracts, buyers will be better prepared to make informed decisions in this particular segment of the real estate market in Dubai.


Chapter 5: Selection of the real estate agent


A - Criteria for choosing a reliable real estate agent


The selection of a competent and reliable real estate agent is crucial for the success of your transaction. Consider the essential criteria to make the right choice.


Experience and reputation:


The agent's experience in the Dubai real estate market is an indicator

key. Consult references and testimonies to assess its reputation.


Reliable references:


Ask for references from other satisfied customers. An established agent will be able to provide references that attest to his professionalism.


Knowledge of the local market:


A good agent must have in -depth knowledge of the local market. It should be able to provide you with information on neighborhoods, market trends and future developments.


B - Verification of recording and legitimacy


Make sure the real estate agent is registered and legally exercises his activity to avoid potential complications.


Registration verification:


Consult the competent authorities to check if the agent is registered and authorized to exercise in Dubai. A legitimate agent will have a license in order.

Presentation of the card issued by Rera [1]:


Check if the agent may present a card issued by the rera. This confirms its official and legal status as a real estate agent.


Consequences of unregistered agents

Keeping against the risks linked to collaboration with unregistered agents, as this can lead to legal complications.


C - Importance of the promoter's sequestration account


Ensure that the promoter has a sequestration account is essential for the buyer's financial security.

First of all, it is necessary to define what a sequestrian account is. This is a sequestration account specific to real estate, the amounts of which are deposited by the buyers of real estate sold on plan in order to regulate and guarantee the law of investors.


Legal obligation :


The sequestration account is a legal obligation for all property developers in order to protect investors. As mentioned previously, this allows investors to be protected against bankruptcies or other failures of promoters allowing the DLD to make reimbursements. The law has been adopted in order to control the real estate market in Dubai and regulate the construction and sale of real estate units in order to guarantee the rights of buyers.


Prior verification:


Before making a purchase, check that the promoter has a sequestration account in place. This can be confirmed by asking for official documents. Indeed, a written agreement concluded between the promoter and the trustee of the account contains details on the main stages of construction which must be completed on the site in order to unlock payments of the sequestrous account.


The project manager at the developer informs the account representative when a step is taken and submits a payment request to service providers. The fident engineer of accounts visits the site and checks the project to ensure the completion of the main construction phase.


Consequences of the absence of a sequestration account:


Please note, this is a legal prescription, all buyers' payments must be paid to the promoter's sequestration account!


By following these advice, buyers can choose a competent, legitimate real estate agent and ensure that the promoter complies with the required financial and legal standards. This contributes to a safer and transparent real estate transaction in Dubai.

 

Part II: Everything you need to know about resale


Chapter 6: Banking constraints for non-residents


A - Specific precautions for international transactions


International real estate transactions, particularly from European countries to Dubai, require special vigilance. Explore the specific precautions to be taken in these situations.



Choice of a real estate agent of the same nationality:


Naturally when the buyer comes from a European country that the buyer will head to a real estate agent of the same nationality in order to facilitate communication and understanding of needs. An often paying strategy, however, it is nevertheless necessary to take the time to do the necessary checks on the company, and its activities. Indeed, it is necessary to ensure knowledge of the projects but especially on the authorizations.


Promoter reliability:


Take particular attention to the promoter's reliability, especially if it is based in Dubai. The distance can complicate direct supervision, hence the importance of increased confidence in the promoter.


Verification of contractual conditions:

Given the potential differences in contractual practices, be sure to understand and check all the contractual conditions, including financial and deadlines.


B - Purchases in terms of international context


Purchases in terms of foreigners add nuances specific to the process. Explore these considerations.


Distance communication:


Remote communication is inevitable in international purchases. Choose reliable communication channels, however, it is quite difficult to establish the necessary diligence in order to verify the reliability of the agents, it is for this reason that we do not recommend remote purchases except in certain cases.


Management of delays and payments:


Delays and payments can be more complex to manage from abroad. Make sure you have a clear strategy to deal with possible delays and stay vigilant about payments. In particular, in the event of rejection of a payment for reasons which may be technical.


International legal consultation:


Consider the consultation of a professional of law specializing in international transactions to guarantee compliance with local and international laws.


C - Hotels apartments in an international context


Contracts related to apartments in hotels have specific considerations in an international context.


Remote goods management:


As previously recalled this management is specific.

The management of remote goods, especially in the hotel context, requires careful planning. Establish a clear understanding of management responsibilities. Indeed, this management is often distinguished from conventional conventional apartments because the promoter often provides for rental management itself as well as remuneration for this management, but also payments according to a room occupancy rate/apartment . It is therefore advisable to be vigilant as to the contractual provisions, or to be able to negotiate your own management or through a specialized real estate agency.


By taking specific precautions for international real estate transactions, buyers can successfully navigate in the complex real estate purchase process in Dubai from abroad. This guarantees unacceptable experience and in accordance with local and international laws.

 

Chapter 7: Obtaining the NOC for resale


A - Banking limitations for non -residents


Non-residents can cope with limitations when opening bank accounts for the transaction. Explore possible solutions and make sure you understand the restrictions.


Limited sequestration account:


Some non-residents may be granted the opening of a sequestration account, but with limitations. Find out about specific conditions and make sure that meets your needs. We support you as to this sequestration account opening.


Avoid payments to third parties:


In the event that a bank refuses to open a sequestrian account for a non-resident, it is strongly advised against making money pour into the account of a third party to avoid problems related to this kind of transactions.


B - Obtaining the NOC (NO objection certificate) for the resale


Obtaining a NOC (non -objection certificate) is a crucial step for the resale of a property in Dubai. Understand this process.


Definition of the night:


A night is a certificate from the promoter indicating that he has no objection to the resale of the property. This is a compulsory step in the resale process.


NOC prior request:


Before putting on sale, make a prior request to obtain the NOC. Some transactions cannot progress without this approval.

Possible challenges:

Be aware of the possible challenges in obtaining the NOC, such as payment arrears or specific clauses in the initial contract.


C - Preparation of resale and contractual considerations


The preparation of the resale requires special attention to the contractual details.

Verification of contractual conditions:

Before putting on sale, carefully check the initial contractual conditions. Understand any restrictions and financial obligations.


Law consultation :


Consider the consultation of a law professional to ensure that all legal aspects are taken into account in the resale process.


Transparency in communication:


Communicate openly with the promoter and the competent authorities to guarantee a transparent transaction and in accordance with local laws.


By anticipating specific resale challenges for non-residents, including the process of obtaining the NOC, and in carefully preparing resale on the contractual level, non-resident owners can maximize their chances of success in this complex process to Dubai.

 

 

Chapter 8: Reason for the NOC refusal and legal consequences


If obtaining a certificate no objection (NOC) is a crucial step for the resale of a property in Dubai. However, there are potential reasons for refusing the NOC which require special attention.


A - Payment backwards


One of the most common reasons for the NOC refusal is the presence of payment arrears. If the buyer has late monthly payments or payments not made according to the initial contract, the promoter may refuse to issue the NOC until the financial situation is regularized.


B - Specific contractual clauses


Certain specific clauses in the initial contract may also result in a refusal of the NOC. For example, specific obligations linked to the duration of possession of the land, restrictions on use, or specific requirements of the promoter may be rejection.


C - Disputes in progress


If the good is the subject of current disputes, the promoter may refuse to deliver the NOC until the complete and satisfactory resolution of these disputes. This aims to protect the interests of all the parties involved in the transaction.


4. Failure to comply with contractual conditions


Any non-compliance with the contractual conditions, such as unauthorized changes to the property or violations of the terms of the initial contract, may result in a refusal of the NOC.


5. Delays in construction permits


If the real estate project faces significant delays in obtaining the necessary construction permits, the promoter can delay the issue of the NOC until all the legal aspects are resolved.


6. Unauthorized structural modifications


Unauthorized structural modifications made to the property may be a reason for refusal of the NOC. It is essential to comply with the regulations and standards in force.


7. Unpaid associated with the co -ownership association


If unpaids are associated with the co -ownership association, the promoter can refuse the NOC until these questions are settled.


In summary, before requesting a night, make sure that all the contractual conditions are met, payments are up to date, and no dispute is in progress. If potential refusal reasons exist, it is recommended to resolve them in collaboration with the promoter and the parties concerned in order to guarantee a fluid and successful transaction.

 

Chapitre 9: Conclusion       

 

Avant de conclure ce guide, il est crucial de rappeler que cet article ne vise pas à offrir des conseils financiers ou en investissement. Au contraire, il résulte de plusieurs années d'expérience dans le domaine juridique des contentieux immobiliers aux Émirats Arabes Unis. En tant que leader sur ce segment, nous avons identifié et recensé les différentes problématiques auxquelles les acheteurs peuvent être confrontés lors des transactions immobilières à Dubai.

 

En conclusion, cet article a exploré en profondeur les différentes facettes des transactions immobilières à Dubai, en mettant particulièrement l'accent sur les défis potentiels et les précautions nécessaires. Que vous soyez un acheteur potentiel, un investisseur ou un professionnel de l'immobilier, il est essentiel de comprendre les complexités légales et les spécificités du marché à Dubai.

 

En résumé, voici quelques points clés à retenir :

 

  1. Choix du Promoteur : Sélectionnez un promoteur fiable avec un historique solide, une réputation positive, et une conformité aux délais de livraison.

  2. Achats sur Plan : Comprenez les avantages et les risques des achats sur plan, en prêtant une attention particulière aux retards potentiels de paiement et de construction.

  3. Réservation et Rétractation : Faites la distinction entre réservation formelle et manifestation d'intérêt, et comprenez les implications juridiques de la rétractation.

  4. Appartements dans les Hôtels : Analysez attentivement les conditions contractuelles spécifiques à ces biens, en prêtant une attention particulière à la gestion hôtelière et aux bénéfices générés.

  5. Sélection de l'Agent Immobilier : Choisissez un agent expérimenté, légitimement enregistré, et avec une connaissance approfondie du marché local.

  6. Transactions Immobilières Internationales : Soyez conscient des défis spécifiques liés aux transactions internationales, en particulier dans les achats sur plan et les contrats d'appartements dans les hôtels.

  7. Revente du Bien pour les Non-Résidents : Anticipez les défis liés à la revente pour les non-résidents, notamment les limitations bancaires et l'importance d'obtenir un NOC.

  8. Conclusion : Rappelant que cet article ne fournit pas de conseils financiers, mais plutôt une compilation d'expériences juridiques pour sensibiliser les lecteurs aux différentes problématiques.

 

En suivant ces conseils et en restant informé, les acheteurs peuvent naviguer plus efficacement dans le marché immobilier dynamique de Dubai, minimisant ainsi les risques et maximisant les opportunités d'investissement. Nous vous encourageons également à nous consulter pour des conseils personnalisés en fonction de votre situation particulière.

 


[1] Real estate regulatory agency


Akram Cheik, Lawyer

 

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