comes to your entitlements. Before deciding to invest in a property,
it is important to understand the difference between freehold and
leasehold property and the rights and responsibilities owning a
freehold property gives you, before you take the step to buy it.
Owning freehold is usually much better than leasing for one main
reason: control. As the owner, you can generally do what you want with
your home provided you keep within the rules and the law.
In 2001, the Dubai government agreed to allow expats to have a 99-year
lease of particular Dubai property, but in May 2002, His Highness
Sheikh Mohammed Bin Rashid Al Maktoum, Vice President & Prime Minister
of the UAE and Ruler of Dubai issued a decree allowing foreigners to
buy property on freehold ownership. The decree sparked the real estate
boom in Dubai's residential property.
The Dubai system offers freehold to owners of all nationalities, but
in the case of high-rise and multiple occupancy buildings exactly what
that means in terms of legal title has yet to be completely defined.
Freehold areas in Dubai include plots in Jebel Ali, the Palm Island
projects, The World islands, Dubai Marina, Emirates Hills and Al
Barsha, among others.
Registration of your property with the Land Department is important to
claim full ownership. Once a property is completed and handed over to
the purchaser, the developer must register the title to the property
in the name of the purchaser in the Real Property Register at the Land
Department.
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.
The Dubai Freehold law specifies the functions and responsibilities of
the Department of Land and Property, which has so far been doing all
the work without much 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.
There is no way for a foreigner to own property in non-designated
areas. If a foreigner wishes to own property in the non-designated
areas, a long lease agreement is the best bet.
Long leases differ from freehold property. Long leases in areas other
than those designated cannot be registered at the Land Department by
foreigners under the new Law. However despite this, these leases
remain as personal rights and are legal. Unregistered long leases in
areas outside of the designated ones remain enforceable as personal
contractual rights between the parties. In regards to any dispute that
might arise from an unregistered long lease, judgment will be passed
by the Rent Committee.
As far as residency is concerned, in principle, a person could own a
property in the UAE and choose not to reside in the property, so you
do not need to be a resident to buy freehold property as it could be
your holiday home. Developers offer visas with property purchase where
buyers are entitled to a six-month multiple entry visa. According to
Gulf News, a recent cabinet decision entitles foreign property owners
to a three-year residence visa if they buy a property worth Dh1
million or more, however this is not yet a law. Ownership of property
and residency or sponsorship are interrelated but should be looked at
separately.
Good luck with your decision!
Kabir Mulchandani
www.skaiholdings.com
Dubai
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