Introduction
This article on property ownership is for an expatriate and unveils a diverse landscape, each emirate offering its distinct set of regulations. From Abu Dhabi’s defined frameworks to Dubai’s more liberal approach, navigating these property ownership paths is akin to embarking on a unique journey.
Property Ownership in Abu Dhabi
Imagine Abu Dhabi as a realm with its own codes of conduct, governed by Law No. 19 of 2005. This legislation outlines specific systems through which expatriates can own residential units, excluding land. The four main avenues are:
Ownership: Expatriates are granted ownership deeds for residential units, valid for 99 years. This empowers them with complete control over apartments and villas, though the ownership does not extend to land.
Musataha: This arrangement allows expatriates a 50-year ownership, renewable upon mutual agreement. Musataha contracts provide the owner with the right to utilize, construct, or modify the property within the stipulated period.
Usufruct: Expatriates can obtain residential units for 99 years under a usufruct contract. While enjoying the use of the property and its facilities, they are restricted from making structural changes.
Long-term lease: For those seeking a lease, a long-term option is available for an initial period, not less than 25 years.
Abu Dhabi designates specific areas for expatriate property ownership, including prominent locations such as Yas Island, Saadiyat, Reem, Mariya, Lulu, Al Raha Beach, Sayh Al Sedairah, Al Reef, and Masdar City. An important amendment in April 2019 expanded property ownership rights for foreigners in Abu Dhabi’s investment areas.
Recent Amendments in Abu Dhabi Real Estate Law
An essential update to the Abu Dhabi Real Estate Law occurred in April 2019. This amendment, impacting Articles 3 and 4 of the law, introduced changes to property ownership rights. Notably:
Article 3 (i): Limited property ownership rights are specified for Emirati citizens, public holding companies with non-national ownership capped at 49%, and individuals granted approval by the Abu Dhabi Crown Prince or the President of the Executive Council.
Article 3 (ii): Non-UAE nationals, both individuals and legal entities, have the right to own and acquire all rights in real estate properties within investment areas.
Article 4: Usufruct or Musataha holders for over 10 years have the right to dispose of the property, including mortgage rights. However, consent from the landlord is necessary for property mortgaging.
Property Ownership in Dubai
In Dubai, in contrast, adopts a more liberal approach to foreign property ownership. Dubai land department oversees the Expatriates, whether residing in the UAE or abroad, can acquire freehold ownership rights in designated areas. This includes freehold, usufruct, or leasehold rights for up to 99 years. The issuance of title deeds by the Land Department adds a layer of transparency to the property ownership process, and there are no age restrictions for property ownership in Dubai. The Dubai land department is the authority responsible for developing necessary legislation for matters related to real estate.
In Dubai, these major legislations govern the matters related to real estate as mentioned below: The registration of all dispositions, pursuant to Dubai Law No. 7 of 2006 (as amended by Dubai Law No. 7 of 2019)
- Law No. 6 of 2019 Concerning Ownership of Jointly Owned Real Property in the Emirate of Dubai
- The registration of all off-plan property sales pursuant to Dubai Law No. 13 of 2008, as amended by Dubai Law No. 9 of 2009, clarified by Dubai Decree No. 6 of 2010 and further amended by Dubai Law No. 19 of 2020
- Registration of short-term leases on the Ejari system pursuant to Dubai Law No. 4 of 2019
- Registration of mortgages pursuant to Law No. 14 of 2008
- Ownership law pursuant to Law No. 7 of 2006
- Landlord and tenant law pursuant to Law No. 26 of 2007
Property Ownership in Sharjah
The Emirate of Sharjah, governed by Executive Council Resolution No. 26 of 2014, presents a nuanced perspective on expatriate property ownership. While full ownership is restricted, foreign nationals and companies owned by them in the UAE can obtain usufruct rights for a maximum of 100 years. This right, however, is subject to approval from the Ruler of Sharjah, and it must be within specified areas.
Conclusion
Property ownership for expatriates in the UAE reflects a spectrum of regulations across its emirates. Abu Dhabi, with its defined systems of ownership, contrasts Dubai’s more open freehold policies. Sharjah offers opportunities with certain restrictions, providing usufruct rights within specified areas. These nuanced regulations cater to the diverse needs of expatriates seeking property ownership in the UAE, making it essential for individuals to grasp the specific rules in each emirate before venturing into real estate endeavors. Every real estate investment of AED 2 million or more in UAE gives a 10-year golden visa to the investor.
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