The valuation or appraisal of a property is carried out by a professional valuer who uses different methods depending on the type of property. The appraisal is typically used to neutrally determine a property’s value and is usually commissioned by lenders or other parties involved in a real estate transaction.

See also “Form F”

Fee charged by dubailand (external link) for transferring ownership of the property from the seller to the buyer. Currently, this fee is 4% of the transaction price and is payable to the Dubai Land Department (internal link) upon transfer. Typically, the parties to the transaction pay the fee equally unless they have contractually agreed otherwise.

Procedure whereby the parties to a purchase transaction (seller, buyer, lender or their legal representatives, if any) present themselves to the Dubai Land Department (or a licensed escrow office) to transfer ownership of a property to the buyer. This procedure also requires the payment of the amounts due to the respective parties.

The title deed issued by the Dubai Land Department proves the legal ownership of the property including any restrictions or obligations (e.g. mortgages). Title Deeds are issued by the Dubai Land Department exclusively for completed properties, for off-plan properties the owner receives a so-called Oqood certificate (see also “Oqood”).

A person (residential) or company, (commercial, office) occupying or otherwise using a leased property.

Project developer of individual buildings or building complexes within a master community. In terms of planning and construction, the subdeveloper is bound by the specifications of the respective master developer.

Sale and Purchase Agreement containing all relevant provisions for a purchase of off-plan real estate in Dubai. This includes, among other things, the purchase price, other contractual ancillary conditions as well as payment modalities. Typically, a SPA is used in off-plan transactions between buyers and developers.

Site plan recorded in the land register at the dubailand describing the layout of the respective units as well as the common areas of the respective property (house or apartment).

The ROI calculates the return on an investment by putting the profit of the investment in relation to the capital invested. It is calculated as follows: (income (e.g. rent)) – (cost of the investment (e.g. maintenance)) / total investment volume.

The Rental Dispute Settlement Centre provides arbitration for the settlement of rental disputes between tenants and landlords and is maintained by the Dubai Land Department.

Through regular publication of the “RERA Rental Index”, Dubai’s real estate regulator RERA provides industry participants with information on market rents depending on a property’s location as well as its size (number of rooms). The statutory rent cap uses the RERA Rental Index as a reference. The RERA Rent Index can be found at www.dubailand.gov.ae.

Trustee office accredited with the Dubai Land Department to provide registration of real estate transactions outside dubailand premises and opening hours.

RERA is the regulatory arm of the Dubai Land Department (DLD). RERA supervises and registers project developers, off-plan projects, owners’ associations, escrow agents and tenancies. In addition, RERA oversees other activities within Dubai’s real estate industry.

Service offered to property owners that typically includes lease management, technical maintenance and repair, and accounting services related to the management of a property.

A register maintained by the Dubai Land Department that lists, among other things, the description and location of a property, as well as the rights attached to it.

Real estate transactions in Dubai can be carried out by power of attorney. A power of attorney is the official appointment of a third person (attorney-in-fact) by the principal for the purpose of representing the principal in the principal’s absence in the execution of legal transactions.

As a result, the proxy obtains the authority to carry out legal transactions on behalf of the principal. In the UAE, powers of attorney are subject to the formal requirement of notarization and legalization. Furthermore, the Dubai Land Department only accepts powers of attorney that specify the property and transaction in question and have a validity of no more than two years.

Powers of attorney issued abroad must be suitably translated and converted into a document valid in the UAE in accordance with the legalization procedure specified by the UAE Ministry of Foreign Affairs.

The Owners`Association maintains, operates and manages all jointly used areas within a jointly owned multi-party property (e.g. apartment building), see also “Common Areas”.

In Dubai, the owners’ associations and the service providers (property management companies) commissioned by them are subject to the rules and supervision of the dubailand real estate regulatory authority.

Registration system maintained by the Dubai Land Department for the purchase of off-plan properties. Upon registration of the transaction, the buyer receives an Oqood certificate from the Dubai Land Department describing and evidencing the buyer’s legal title in the particular property.

Property that is under construction at the time of purchase. In Dubai, a comprehensive legal framework has now been established to protect the interests of buyers when purchasing property under construction. Off-plan purchases can take place between project developers and buyers (primary market) as well as between two buyers (secondary market). When buying from a developer, the buyer receives an Oqood Certificate from the Dubai Land Department as proof of ownership (instead of a Title Deed) and is registered as the owner in the Interim Real Estate Register of the Dubai Land Department.

When purchasing real estate in the Emirate of Dubai, the Non-Objection Certificate (“NOC”) certifies the developer’s consent to the transfer of ownership of the property. An NOC must be applied for and obtained by the seller from the project developer prior to the transfer of ownership by the Dubai Land Department. The latter has the right to charge a fee not exceeding AED 5,000 for the issuance of the NOC (for off-plan properties). If applicable, the issuance of another NOC by the master project developer (“Master Developer”) may be required prior to the transfer of ownership. The consent of the Project Developer may not be withheld without good cause, such as a backlog of Common Area Maintenance contributions.

The non-disclosure agreement deals with the disclosure of confidential, non-publicly accessible information of parties during the initiation and/or execution of a business transaction (e.g. real estate purchase). It regulates the rights and obligations of the respective parties in detail.

When purchasing real estate in Dubai, the so-called Memorandum of Understanding (MoU) is part of the purchase agreement and describes the details of the real estate transaction in detail. The MoU usually contains the purchase price, payment terms and dates as well as other details of the agreement and is usually used in addition to the “Form F” required by the Dubai Land Department.

Debtor (“Buyer”) who uses a loan to purchase a property in Dubai and accepts the registration of an encumbrance (mortgage) on the property located in the Emirate of Dubai as security for the loan. The security is registered in the land register at the Dubai Land Department listed on the title deed (“Title Deed”).

Financial institution or bank (“creditor”) that grants a loan for the purpose of purchasing real estate and has a mortgage on the real estate recorded in the land register at the Dubai Land Department as security for the loan. The contracting party is the mortgage debtor (real estate purchaser).

When buying real estate in Dubai, the mortgage is the legal instrument to secure the loan used for the real estate purchase. In this case, the mortgage (charge) on the property is registered in the property register at the Dubai Land Department (see also “lien”).

Development area or building complex for which multiple uses such as residential, office and commercial are intended. Use type may be specified by development area (community) or building/building complex.

Project developer entrusted with the development of a master community (self-contained area). The master developer implements urban planning specifications within the master community and is responsible, among other things, for creating the infrastructure and providing network connections.

Encumbrance (“Mortgage”) of the property (e.g. for a loan) registered in the property register at the Dubai Land Department, which is to be redeemed before the sale of the same.

Preliminary written agreement between two parties (e.g., buyer and seller) that defines the terms under which the buyer is willing to purchase the property from the buyer. While an LoI takes the form of a written contract, it is typically not fully binding on the parties.

Alternative term for “landlord.”

“Lessee” is the alternative English term for “tenant”.

A bank or other financial institution that grants a loan for the purpose of acquiring real estate.

Variant of real estate purchase in Dubai in which the leaseholder acquires ownership of the real estate (buildings), but not the associated land. Typical leasehold terms in Dubai vary between ten and 99 years. A leasehold title can generally be transferred (e.g. by sale or inheritance) for the remaining term of the lease. The leasehold title is registered in the property register at the Dubai Land Department and shown on the title document (“Title Deed”).

Lease agreement between the owner of a property and its tenant, which regulates in detail the use of the property by the tenant as well as the term and consideration (rent). In Dubai, the standardized Dubai Land Department document must be used as the basic contract. Additional agreements or clarifications are usually recorded in an annex (“addendum”).

Finally, the executed contract signed by all parties must be registered in the Ejari system.

The legal owner of a property in Dubai according to the Dubai Land Department register of owners, which is leased to a tenant.

Real Estate Register at the Dubai Land Department for properties acquired in Dubai off-plan and still under construction (see also “Oqood”).

For real estate financing in Dubai, lease-purchase is also eligible since 2019.  In the Emirate of Dubai, lease-purchase is implemented through a variant of Sharia-compliant real estate financing (variant of lease-purchase), in which the lender (landlord or seller) leases the property to the borrower (tenant or buyer) until the real estate loan is fully paid off. For such structured lease purchases, the Dubai Land Department (DLD) issues a special title deed called “Ijara” (“Title Deed”).

The Gross Rent Multiplier relates the price of a property to the gross rent that can be achieved, excluding current service charges. (Gross multiplier= property price / achievable gross rent). A lower multiplier implies a higher gross return on the real estate investment.

Variant of ownership title, where the owner acquires ownership of both the land and the buildings located on it for an indefinite period of time (in contrast to the so-called “leasehold”, where only ownership of the building, but not of the land, can be acquired). The title of ownership is registered in the property register at the Dubai Land Department and the real estate ownership is proven by a deed (“Title Deed”).

Furthermore, the freehold areas (“Designated Areas”) are characterized by the fact that in these real estate property can also be acquired by non-GCC citizens. Typical freehold areas are Dubai Marina, Palm Jumeirah and Emirates Living, JLT, Business Bay, Downtown Dubai, Dubai Creek Harbour and virtually all communities in Dubai Land. These again include Arabian Ranches, Jumeirah Golf Estates, Mudon, Dubai Sports City, IMPZ, The Villa and Villanova (list not exhaustive).

Standardized contract between seller and buyer of a property in Dubai , detailing the terms and conditions of the real estate transaction (also known as a “Unified Sales Contract”).

Contract (brokerage agreement) by means of which the buyer and real estate agent agree to purchase or arrange the purchase of a property.

Contract by which seller and real estate agent in Dubai agree to offer a property for sale.

Procedure by which the lender obtains repossession of the collateral (property) upon default of principal payments.

Offer document issued by the lender notifying the buyer (mortgagor) of the commitment to finance the purchase of a property in Dubai (mortgage loan) in accordance with the further notified details (subject of the loan, collateral, interest rate, term). Before receiving the final financing offer for the purchase of a property in Dubai, a basic approval (“pre-approval”) must be obtained from the bank. This is followed by the purchase price negotiation and agreement between buyer and seller by means of a “Memorandum of Understanding” (MoU).

A bank or other financial institution registered with the Dubai Land Department (Dubai Land Department) and authorized to maintain escrow accounts.

When purchasing “off-plan” real estate in Dubai (real estate under construction), payments are to be made exclusively to so-called escrow accounts. The escrow accounts are maintained by project developers with local banks that are specially licensed for this purpose and registered with the Dubai Land Department.

The use of the funds deposited in the Escrow Accounts is subject to the regulations and supervision of RERA.

EJARI is a system implemented and maintained by the Dubai Land Department for the registration of leases in Dubai. The registration of existing leases has become a mandatory requirement for the release of electricity and water. Furthermore, EJARI registration is necessary to conduct proceedings before the Rental Dispute Resolution Center.

The Dubai Land Department (DLD) is responsible, among other things, for the registration of real estate transactions (purchase/sale of real estate) as well as their registration in the land register and the issuance of the related title of ownership. In addition, the DLD issues implementing regulations relating to real estate laws and provides a range of services to the real estate industry in Dubai.

Designated areas, also known as “Freehold Areas”, are areas in the Emirate of Dubai where full ownership of real estate can be acquired even if the purchaser is a non-GCC national.

The ownership of real estate in Dubai is proven by the so-called “Title Deed”. At transfer of ownership, the entry in the register of owners (land register) is effected at the Dubai Land Department.

Common areas are those areas in multi-party properties that are shared by their occupants and owners. These typically include areas such as entryways, fitness areas, pool, as well as stair areas and hallways.

Common areas are managed by the property owners’ association and the costs of maintenance and repair (service charges) are billed to the owners on a pro-rata basis.

Commission is the fee charged for arranging a real estate transaction in the Emirate of Dubai (e.g. buying/selling or renting). Commission is usually determined as a percentage of the underlying transaction. The charging of a commission is reserved exclusively for RERA registered brokers (“Brokers”).

Since 01.01.2018, the commission payable is subject to Value Added Tax (VAT) at the rate of 5%.

In Dubai, collateral is usually given to the lender to secure a real estate financing. If a bank loan is used to purchase real estate (mortgage), the real estate is used as collateral for the corresponding loan.

The security is registered in the land register at the Dubai Land Department and recorded on the title deed.

CAP Rate is the ratio of net income to purchase price of a property. In contrast to the gross yield, management costs are taken into account, but in contrast to the net yield, incidental acquisition costs are not. A higher CAP rate corresponds to a higher return on investment (“ROI”).

A broker (real estate agent) in the Emirate of Dubai is a person who acts as an intermediary between sellers and buyers of real estate (secondary market), as well as between project developers and buyers in the primary market (“off-plan”) when purchasing real estate. In the Emirate of Dubai, any person acting as a real estate broker must have a RERA card and a business license issued by the Department of Economic Development (DED).

In Dubai, a broker registration number is assigned to each real estate agent (“Broker”) operating on a regular basis and licensed with the Dubai Land Department. This must be indicated on all marketing materials used, together with the ORN (Office Registration Number).

Normal wear and tear due to normal use of the leased property by the tenant. Under Dubai lease law, the tenant does not have to compensate the landlord for normal wear and tear of the leased property.

Expressed as a percentage, yield refers to the return generated by the property in relation to the capital invested. It is calculated by putting the net return – usually rents less relevant costs – in relation to the capital employed (transaction price plus incidental costs) (see also “ROI”).

Since 03.09.2020, retirees from all over the world can settle permanently in Dubai. The granting of a so-called “Retirement Visa” is a novelty for the UAE and requires proof of financial stability or ownership of a property in Dubai.

Financial stability is defined as a monthly income of AED 20,000 or more or liquid assets of AED 1,000,000 or more.

A property located in Dubai also qualifies for the retiree visa if it exceeds AED 2,000,000 in value.

Since 2020, there is the possibility for real estate investors to obtain a five-year renewable permanent residence right in the Emirate of Dubai.

The value of the property must not fall below the amount of AED 5,000,000. In addition, the property must be fully owned (hereditary lease not permitted) and the purchase price must have been paid in full by equity capital; external financing is not permitted.

The permanent right of residence can also be extended to children and spouses of the beneficiary, but does not entitle the beneficiary to take up employment in Dubai.

The so-called “Taskeen” program allows real estate investors to obtain a three-year renewable permanent residence right in the Emirate of Dubai.

The value of the property must not be less than AED 750,000. If the property is debt financed, at least AED 750,000 in equity must have been contributed to the property purchase.

Permanent residency can also be extended to children and spouses of the beneficiary.