Question 1

What is an Escrow Account?

Accepted Answer

An escrow account is generally a third-party medium that holds the money transferred from the buyer until the merchant fulfills the escrow agreement. A failure to fulfill this agreement from the merchant results in the money being refunded to the buyer.

An escrow account in the UAE real estate market has a very specific function. According to escrow account laws, the developers of different projects have to open an escrow account for every project. Doing so allows for better regulation of the funding that project developers receive from their buyers for project construction.

Question 2

What is Freehold Property?

Accepted Answer

Freehold property is a kind of property purchase that entitles a buyer to own the plot and the unit. That landowner is entitled to the title deed under their name. Freehold property is inheritable to an heir. Moreover, the owner holds the authority to occupy, lease, or sell the property.

The purpose of allowing freehold property purchases was to facilitate foreign investors and encourage them to invest in the UAE. This law allows expats to purchase freehold properties in Al Barsha, Emirates Hills, Palm Jumeirah, and Dubai Marina.

Question 3

Can the Power of Attorney be used to buy and sell properties in Dubai?

Accepted Answer

A proper power of attorney is a legal proxy that benefits property owners and buyers. According to the law, a person with the power of attorney can buy, sell, or transfer the possession of a property on the behalf of their client. The POA generally allows property sale, mortgage, and gifting. Typically, the validity of such type of POA is 2 years. On the other hand, the POA will be valid for five years in case it is attained for the property purchase. The date of notarization at the notary public is when this POA becomes valid.

Question 4

What is Ejari Dubai?

Accepted Answer

Ejari stands for ‘my rent’. In Dubai, it is an electronic online registration system to register and regulate tenancy contracts. This system governs rental transactions and ensures that all contracts are law-abiding. Thanks to the Ejari system, Dubai is one of the most regulated rental markets in the world.

Question 5

What is the purchase process?

Accepted Answer

In case the property is being resold, the buyer and reseller have to sign an MOU. This MOU, or Memorandum of Understanding, defines the terms and conditions of the sale transaction between the buyer and reseller.

On the other hand, a SPA will be signed if the buyer purchases the property directly from the developer. SPA, or Sales Purchase Agreement, states all the terms and conditions about the sale transaction and is an essential document to be signed by the buyer and developer.

Here is an overview of the documents needed to list a property with ANW Real Estate:

Documents required for leasing:

• Sales Purchase agreement (SPA) or Oqood or Title Deed
 • Owner-signed leasing form
 • Filled listing sheet
 • Signed passport copy of the owner
 • POA document and a signed passport copy of the POA

Documents required for sale:

• Sales Purchase agreement (SPA) or Oqood or Title Deed
 • Owner-signed Form A
 • Filled listing sheet
 • Signed passport copy of the owner
 • POA document and a signed passport copy of the POA

**You will need a Certificate of Completion to get it verified by the Propertyfinder for newly handed over properties.

Question 6

What is Oqood?

Accepted Answer

Oqood, the Arabic word for contracts, is an online service that Emirates Real Estate Solutions offers to developers. The purpose of this service is to help with property registration between buyers and developers.

Question 7

What is Off-Plan?

Accepted Answer

A property whose construction has not yet begun or is in initial stages is known as an off-plan property.

Question 8

What is DLD?

Accepted Answer

DLD stands for Dubai Land Department, and it is a regulatory authority that oversees legislation and the organization of all properties and real estate. It also deals with all real estate transactions in Dubai.

Question 9

What is DLD Waiver?

Accepted Answer

DLD Waiver refers to the waiver of the DLD fee charged on the occasion of a property purchase. This fee constitutes 4% of the property value and should be paid by the buyer. In general, this fee is payable by the developer instead of the buyer.

Question 10

What is the difference between freehold and leasehold?

Accepted Answer

Freehold refers to the complete property purchase, which results in the buyer’s name on the title deed. On the other hand, leasehold refers to getting a property on lease for a period ranging from 10 to 99 years. In other words, leasehold is not a complete property purchase.

Question 11

What is RERA Dubai?

Accepted Answer

RERA, or the Real Estate Regulatory Agency, is a DLD faction responsible to take care of the real estate industry regulations in Dubai. The primary job of this department is to regulate the relationship between all parties involved in a contract and organize the property exchange process.

Question 12

What is DEWA Dubai?

Accepted Answer

DEWA stands for Dubai Electricity and Water Authority, the department providing electricity and water supply in Dubai.

Question 13

How to apply for DEWA?

Accepted Answer

You can visit the DEWA website or visit DEWA offices physically to apply for their services.

Question 14

How to register for Ejari?

Accepted Answer

Registering every tenancy contract with Ejari is a must. It is mainly the tenant’s responsibility to get the contract registered. The necessary credentials required for this registration are the signed title deed, SPA, title deed, passport, copy of landlord’s passport & fingerprints, SPA, and visa & EID.

Question 15

Do I need Ejari for DEWA?

Accepted Answer

Yes, it is necessary to get registered with Ejari before applying for utilities from DEWA.

Question 16

What is the security deposit, what is its amount, and what does it cover?

Accepted Answer

A security deposit is usually 5%-10% of the annual rent that a tenant has to pay to the landlord in advance. This fee acts as protection for the landlord in case the tenant fails to fulfill one or more of the obligations mentioned in the contract. This deposit mainly covers property damage, loss of rent, loss of security keys, and repairs.

Question 17

What are the security deposits tenants need to submit when renting a property?

Accepted Answer

Generally, a security deposit of 5% is required for an unfurnished property, whereas 10% is needed when renting a furnished property. Moreover, you will have to pay a DEWA deposit of AED 2000 when renting an apartment and AED 4000 when renting a villa. An Ejari fee of AED 225 is also payable here. In addition to everything, there will also be an agency fee if there is a chiller requiring a deposit.

Question 18

What documents are required to qualify for a tenancy agreement for a property?

Accepted Answer

The tenant must present original copies of the passport and a valid residence visa to qualify for a tenancy agreement for a property. These documents must be presented to the property broker. A valid trade license, general managers’ passport copy, and a valid passport are required if the person renting the property is a corporate tenant.

Question 19

Does a tenant need to register their tenancy contract with Ejari?

Accepted Answer

Yes. The tenancy contract’s registration with Ejari is a must for contract validation. According to the law, the tenant will be disallowed to make any claim without fulfilling this requirement.

Question 20

Can a tenant terminate their contract during the tenancy period?

Accepted Answer

Yes, but you have to notify your landlord two months in advance when terminating your tenancy agreement. Moreover, you will have to pay two months’ rent in advance and settle all your utility bills when vacating the property.

Question 21

Can landlords disconnect Empower, DEWA, or other utility services to vacate a tenant from their property?

Accepted Answer

No, Dubai real estate laws do not allow landlords to disconnect these services to vacate a tenant from their property.

Question 22

What is a primary market?

Accepted Answer

A primary market is a marketplace where new properties are available for purchase directly from the developer.

Question 23

What documents are filled in to purchase a property on a primary market?

Accepted Answer

The following documents are needed when purchasing freehold property in Dubai:

• Emirates ID
 • A valid passport
 • A credit card if you prefer paying with the card
 • Reservation form
 • A filled-in Customer Information Form

Question 24

How much time does it take to register a real estate sale and receive the ownership certificate?

Accepted Answer

Registering a sale generally takes 30 minutes, given that all of the necessary documents are in order.

Question 25

Can you sell an off-plan property before its date of completion?

Accepted Answer

Yes, you are authorized to sell an off-plan property before its date of completion.

Question 26

How to qualify for a UAE investor visa?

Accepted Answer

An investment of AED 1 million or above in at least one of three real estate properties makes you eligible for a UAE investor visa.

Question 27

Do I have to pay tax on a property in Dubai if I am a resident abroad?

Accepted Answer

No, there is no tax payable on you if you are a resident abroad.

Question 28

Is it better to get a mortgage from a bank or through a broker?

Accepted Answer

The advantage of contacting a mortgage broker is you get an unbiased opinion on available mortgages and plenty of other options.

Question 29

Is it possible to mortgage a property in Dubai?

Accepted Answer

Yes, the option of mortgaging a property is available in Dubai.

Question 30

Can foreign investors own a freehold property in Dubai?

Accepted Answer

Yes, Dubai real estate laws authorize foreign nationals to own freehold properties in Dubai’s designated freehold areas. These properties are inheritable to the heirs of those foreign nationals.

FAQs