Dubai offers numerous tourist attractions and numerous opportunities to start up businesses as well as an attractive real estate market. You can buy real estate in Dubai both to live in it and to rent it. But also as investment objects, real estate in Dubai is excellently suitable. However, you have to know that as a foreigner you can only acquire unlimited property rights in certain areas. Outside of these areas, foreigners are also allowed to acquire transferable property rights, but there is a time limit. Another peculiarity related to the purchase of real estate in Dubai is that financing by banks is so complex that it does not promise great prospects of success.

Buying Property in Dubai – Introduction

Dubai has awakened to the modern fairyland from 1001 nights. Even more – it has developed into the day after tomorrow country. It certainly owes all this to its rich natural resources, but also to the wise foresight that this blessing will one day dry up. So Dubai as one of the many emirates on the Persian Gulf has looked for other pillars for its future economy and found many attractive alternatives. In addition to the establishment of companies from all over the world and the now booming tourism, the real estate market is also an emerging silver lining. That is why the emirate is aggressively promoting its investment potential in this sector among international investors. And this is more than reason enough for us to see what Dubai has to offer and how this potential can be developed.

Buying real estate in Dubai: framework conditions

On the one hand, the Emirate of Dubai consists of a large urban area of interconnected districts connected by highways. On the other hand, there are now also more and more settlement areas outside the city. They have been painstakingly snatched from the desert over the years, which still forms a strong contrast to the modernity of the city. So if you want to invest in real estate in Dubai, you have the choice between the rural and the lunar as well as everything that is located in between.

However, as foreigners who now make up a vast majority of the emirate’s population, we encounter a border. This is understandable insofar as it is not in any state in the world to offer its own country in the sell-off of foreign investors. Dubai has also decided that the acquisition of land to foreigners should be regulated and restricted.

Buying Property in Dubai: Freehold and Sharehold Zones

3.1. Distinction Freehold and Sharehold Zones

So it has been determined that foreigners are only allowed to buy real estate in Dubai in certain areas. These areas are called freehold zones. Only in these districts are foreigners allowed to acquire real estate without restriction. After all, property rights in real estate located in these areas encompass the whole range of rights that we are generally familiar with in Europe.

In contrast, Dubai grants limited property rights in the other areas when buying real estate. The main limitation concerns the term of validity of acquired rights, which is 99 years. Since it is more about long-term lease agreements than real ownership, these areas are also called sharehold zones. After all, the property rights acquired in these areas can also be transferred, for example by sale, gift or inheritance.

3.2. Which areas belong to the Freehold Zones?

Regulation No. (3) of 2006 Determining Areas for Ownership by Non-UAE Nationals of Real Property in the Emirates of Dubai defines as Freehold Zones the following areas: