Ownership of foreigners in the UAE
According to UAE federal law on ownership and the regulations of each individual emirate, legal residency is granted to every foreigner who owns property and invests in real estate in the United Arab Emirates, regardless of the type of ownership available in the country.
When asked if ownership in the UAE is possible, the answer is yes, as we will explain in this article.
Ownership of foreigners in the UAE
Under the real estate ownership law in the UAE, residency permits based on ownership for foreigners come in several categories, each with its own advantages.
The laws and conditions for ownership in the UAE vary from one emirate to another, with the main requirements for foreigners to buy property in the three key emirates summarized as follows:
Freehold in Dubai
Ownership of foreigners in the UAE
Dubai is the main destination for money and business in the UAE and is considered the country’s primary hub for investment and investors from around the world.
The real estate market in Dubai has great investment value, with massive and diverse property projects.
According to Article 3 of UAE Federal Law No. 3 of 2006 concerning ownership by non-citizens in the UAE, the areas where freehold ownership by foreigners is allowed in Dubai have been specified.
Foreign investors looking to find a home to buy in Dubai or any other property, can inquire with the authorities about the areas they can own freehold property and learn all the procedures, conditions and legal justifications.
In Dubai, foreigners are allowed to own all types of commercial or residential properties in the designated freehold areas.
Ownership of foreigners in the UAE
Requirements for Foreigners to Buy Property in Dubai
In terms of requirements for foreigners who want to find a house for sale in Dubai or any property, Dubai is described as having the best and most seamless conditions for foreigners looking to acquire ownership rights in the UAE. The legal regulations governing foreign investment in Dubai rely on the emirate’s own laws issued by the Government of Dubai, as well as other general federal laws issued by the Federal Government of the UAE.
Ownership of foreigners in the UAE
The requirements include:
- Absolute freehold ownership in designated freehold areas.
- Restriction to freehold only in designated areas.
- Registration of the property with the Dubai Lands Department.
- Payment of dues related to purchasing an apartment in Dubai, such as: Lands Department fees, property registration fees, valuation fees, mortgage registration fees, and mortgage registration fees.
- Full ownership (100%) for foreign investors in Dubai of more than 1000 business and industrial activities, except for economic activities related to the strategic dimensions of the state, which include 7 different sectors.
Ownership of foreigners in the UAE
Freehold in Abu Dhabi
Abu Dhabi is the UAE’s political capital and is known for its vibrant trade activity and strong, well-known oil and energy production companies, as well as a robust real estate market.
There are 9 areas in the Emirate of Abu Dhabi where foreigners are allowed to own real estate:
Yas Island, Al Raha Beach, Al Reem Island, Al Maryah Island, Al Lulu, Saadiyat Island, Seih Al Sedirah, Al Reef, and Masdar City.
Regarding property ownership requirements for foreigners who are looking for a house to buy in Abu Dhabi or any other property, in April 2019 a law was issued amending some provisions of Law No. 19 of 2005 on real estate ownership. The amendment granted foreign natural and legal persons the right to own properties located within investment areas and to dispose of them.
The new law stipulated the replacement of Articles 3 and 4, with the new Article 3 stating that the right to own properties is limited to the following categories:
- UAE citizens and those of similar status.
- Public joint stock companies in which foreign participation does not exceed 49%.
- Anyone who is issued a decision by the Crown Prince or Chairman of the Executive Council.
The law stated that foreign natural and legal persons have the right to own, acquire all original and subsidiary in-kind rights, and dispose of properties located within investment areas.
The new Article (4) stipulated that usufruct and musataha rights holders for more than ten years may dispose of these rights, including mortgaging them, without the owner’s consent. The property owner may only mortgage it with the consent of the usufruct or musataha right holder. The parties may agree otherwise in both cases.
Ownership of foreigners in the UAE
Ownership methods and systems of real estate in Abu Dhabi
Foreigners have four ownership systems for properties in the Emirate of Abu Dhabi, which are:
- Freehold Ownership: Through this system, foreigners are granted ownership deeds for residential properties without the land for a period of 99 years. They have full rights to dispose of the residential property and make changes to it (such as a villa or apartment) without owning the land.
- Musataha Ownership: Foreigners can invest in constructing on undeveloped land through the Musataha ownership system in Abu Dhabi. The ownership period is limited and can extend up to 50 years, renewable for a similar duration upon mutual agreement. The foreign investor has the right to benefit from the property and make changes to it.
- Usufruct Ownership: Under this system, residential properties can be owned for a period of 99 years in designated investment areas. The owner has full usufruct rights without making any changes to the property.
- Long-Term Lease: The right to lease residential properties for an initial period of no less than 25 years.
Ownership of foreigners in the UAE
Freehold in Sharjah
One advantage of the Emirate of Sharjah is its proximity to Dubai. Property prices are lower than in neighboring Dubai, making it an attractive destination for investors whose budgets do not match Dubai’s relatively high real estate prices.
According to Sharjah Executive Council Resolution No. 26 of 2014 on the usufruct of properties in the Emirate of Sharjah, with the approval of the Ruler and under the conditions he decides, those not entitled to ownership in the emirate and their companies may obtain a license in permitted areas designated by the government. The duration of usufruct is a maximum of 100 years from the date of signing the usufruct contract with the Real Estate Registration Department in Sharjah.
Requirements for Foreigners to Buy Property in Sharjah
Regarding requirements for foreigners who are looking for a house to buy in Sharjah or any other property, the Sharjah government allows foreigners to own properties for a usufruct period not exceeding 100 years, in designated areas for foreign ownership. The usufruct right is absolute, allowing the foreigner to lease, reside in, modify, or resell the property.
Ownership of foreigners in the UAE
Advantages of Owning Property in the UAE
Foreign investors looking to invest in the UAE’s real estate market can take advantage of several benefits, including:
- The ability to obtain UAE residency without a sponsor, renewable periodically depending on the residency type, without legal obstacles as long as the property is owned.
- Residency includes spouse and children, with the ability to sponsor a certain number of private staff.
- Obtaining a UAE residency ID that allows starting investments in the UAE legally.
- Eligibility and nomination for a UAE golden visa with additional advantages.
- Consistently high returns if the property is leased or resold in a continuously developing market with steadily increasing demand.
- The chance to settle and live in the UAE’s high quality lifestyle of luxury, comfort and modernity.
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Ownership of foreigners in the UAE
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