DUBAI REAL ESTATE MARKET TERMINOLOGY FOR INVESTORS
DUBAI REAL ESTATE MARKET TERMINOLOGY FOR INVESTORS
Dubai continues to attract investors from around the globe, although some encounter challenges. The main reason for these challenges is the differences in legislation and rules of the local market compared to other countries. In Dubai, there are several mandatory provisions that an investor must fulfil before purchasing a property. These include buying real estate in designated freehold zones and independently registering the property with the Dubai Land Department. Dubai may also have its own set of rules and terminology, which might differ from other emirates. Therefore, understanding the nuances of the local market will significantly ease your life and work here.
GENERAL TERMINOLOGY OF THE DUBAI REAL ESTATE MARKET
OFF-PLAN – a term that refers to new homes currently under construction but available for sale. Payment in this case will be made in several stages throughout the construction process. The Dubai Land Department oversees these transactions to safeguard the interests of both investors and developers.
FREEHOLD – foreigners who do not have UAE residency have the right to purchase property only in special freehold areas. There are about 60 such zones across Dubai, including central and suburban areas. Further details regarding the available freehold areas have been covered in a separate article.
EMIRATES ID – an identity card issued to all UAE citizens and residents.
GOLDEN VISA – a special program by the Dubai government to increase investment in the emirate. One way to obtain a golden visa is by investing a certain amount in business or residential real estate. The program guarantees the investor and their family residency in the emirate for several years, with the possibility of obtaining full UAE citizenship.
AL SA’FAT – this term indicates that a construction system prioritises high environmental sustainability standards. It applies to any residential development, from apartment complexes to villa communities or townhouses.
DLD – the abbreviation for the Dubai Land Department, the authority regulating all real estate transactions and the construction of new objects. If you want to sell an apartment or rent it out, you will also have to record the entire transaction process in the DLD.
IJARAH – analogous to the Rent to Own system, where you pay rent monthly until you fully pay off the cost of the housing. Upon completion of payments, you become the full owner of the property.
LICENSE AND SERVICES FOR WORKING WITH DUBAI REAL ESTATE
DEWA – the sole company in Dubai responsible for utility services, managing everything from electricity to water. The company offers various convenient platforms, including a website, service centres, and a mobile app for bill payments and utility connections for real estate.
EJARI – an online database of all long-term real estate lease agreements. When leasing out one of their properties, the owner is required to enter all the deal information into the Ejari system.
Holiday Home Permit is a licence necessary for engaging in short-term rentals. Investors holding a Holiday Home Permit can lease out up to eight of their properties, provided they have a Unit Permit.
Unit Permit – after registering an apartment in the DTCM system, the owner receives a Unit Permit, allowing the short-term rental of the property.
NOC – a certificate from the developer required by the investor when selling the purchased property to a third party. It guarantees that the property owner has no outstanding debts.
FORM F – a purchase agreement between the developer and the future homeowner. It includes all details such as the price and payment schedule.
MAKANI – a building numbering system implemented in Dubai, where each building has its own 10-digit code.
DIFFERENCES IN TERMS ACROSS EMIRATES
Most of the main terms and services are uniform across all emirates in the UAE. However, some of them may use their own online systems and licences for dealing with real estate and investors. Here are some of them:
- While Dubai uses Ejari, Ajman employs the Tasdeeq system. Their functionalities are almost identical, serving as databases where property owners are required to register information about concluded rental agreements.
- Tawtheeq is another Ejari equivalent but for Abu Dhabi. Another difference is the rental agreement registration process, which can take up to one month.
- Estidama in Abu Dhabi closely mirrors Al Sa’fat, focusing on the sustainable development of areas and the eco-friendly construction of new edifices.
INVESTING IN DUBAI REAL ESTATE
If you’re interested in Dubai’s real estate investment potential but facing difficulties, reach out to Keyspace Realty. Our agents will answer all your questions, help you select the right property, and provide full support throughout the entire transaction process.
