Property Laws, Fees, and Process: Key Rules Foreign Buyers Must Know in the UAE
As property ownership continues to attract more residents in the UAE, it’s important for buyers, especially expatriates to understand the laws and costs that apply to them. Regulations can differ for Emiratis and foreigners, so knowing the rules in advance can help avoid surprises.
According to Robert Villalobos, head of brokerage at Engel & Völkers Middle East, buying real estate as an expat is generally straightforward, but it’s essential to be aware of the legal frameworks and additional charges before committing.
Can Foreigners Buy Property Anywhere in the UAE?
In Dubai, property ownership is divided into freehold and leasehold structures. Expatriates can only buy in government-designated freehold zones, which include highly popular areas such as Palm Jumeirah, JBR, Downtown Dubai, Dubai Marina, Dubai Hills Estate, Dubai Creek Harbour, and Arabian Ranches.
“There are over 70 freehold zones across Dubai, giving foreigners plenty of choice — from luxury waterfront living to family-friendly communities and vibrant urban hubs,” explained Mr. Villalobos.
Freehold vs. Leasehold: What’s the Difference?
Freehold ownership grants complete rights over both the property and the land it sits on, with no time limit. Owners can live in, rent, sell, or pass down the property freely.
Leasehold, however, is time-bound, typically lasting between 30 to 99 years. The land remains under the ownership of the freeholder, usually the government or master developer. Once the lease term expires, ownership reverts unless renewed.
How Do the Rules Differ Across Emirates?
Ben Crompton, managing partner at Crompton Partners in Abu Dhabi, highlighted that while each emirate has its own real estate regulations, most transactions are contract-driven.
The binding agreement is the memorandum of understanding (MOU) between buyer and seller. In Dubai, this is a standardized Form F,” he noted.
Abu Dhabi’s Framework
Abu Dhabi has two distinct legal jurisdictions:
Abu Dhabi Global Market (ADGM), which governs Reem Island and Maryah Island.
Abu Dhabi Real Estate Centre (ADREC), which covers the rest of Abu Dhabi.
Property transfers here are largely process-driven, with contracts and brokers playing a central role. While ADGM uses a standard contract form, ADREC is expected to introduce one soon.
Abu Dhabi also recognizes three types of ownership:
Freehold – complete ownership of property.
Usufruct – a 99-year lease for residential use.
Musataha – a 49-year lease (renewable) that allows building and development on the land.
Where Can Expats Buy in Abu Dhabi?
Foreigners are permitted to buy in designated investment zones, such as Saadiyat Island, Yas Island, Reem Island, Maryah Island, Al Reef, Raha Beach, Jubail, and several others. Areas outside of these zones remain restricted to UAE nationals.
Additional Costs Buyers Should Expect
Many foreign buyers assume the agreed purchase price is the only cost — but that’s not the case.
In Dubai, buyers should also budget for:
4% transfer fee to the Dubai Land Department
2% broker commission (plus VAT)
Annual service charges for community maintenance, security, and facilities
Do You Need Residency or Physical Presence to Buy?
The answer is no. Expats do not need to be UAE residents, nor do they need to be physically present for the transaction. Purchases can be made remotely through digital signing of Form F and via power of attorney for ownership transfer.
Is Buying in the UAE Worth It?
Despite the added fees, real estate remains an attractive option for expatriates. Mortgage rates are competitive, and in many cases, monthly repayments can be lower than comparable rental prices.
Expert Tips for New Buyers
Mr. Villalobos advises researching communities and lifestyle offerings before making a decision, then working with a reputable brokerage to guide the process — from mortgage approvals and viewings to negotiations and transfers.
Mr. Crompton adds that, particularly in Abu Dhabi, where brokers handle most conveyancing, choosing an experienced agent with a strong MOU is crucial. “Always review the MOU carefully, as it dictates how the transfer between buyer and seller takes place,” he emphasized.