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Foreign Ownership of Properties in Abu Dhabi

Posted by on 26 December 2023

Foreigners are allowed to own properties within designated areas called “freehold zones” in Abu Dhabi, on the condition that they adhere to the regulations and legislation outlined in the Emirate’s Real Estate Regulatory Law.

This article by Realty Zone explores the property ownership systems for foreign investors in the Emirate, emphasizing specific areas and permissible ownership terms, alongside the purchasing guidelines as specified in the law.

Freehold in Abu Dhabi

In 2005, Abu Dhabi granted foreign investors the right to freehold property ownership in several investment zones within the Emirate. This decision marked a shift from ownership being restricted solely to citizens and Gulf Cooperation Council countries.

Freehold ownership refers to the right to own property units like apartments or villas without owning the land on which they’re built. This grants property owners full rights to manage and benefit from their property.

Areas where foreigners can own properties in Abu Dhabi

There are 9 areas in the Emirate of Abu Dhabi where foreigners are permitted freehold ownership, which are as follows:

  1. Yas Island.
  2. Saadiyat Island.
  3. Al Reem Island.
  4. Al Maryah Island.
  5. Lulu Island.
  6. Al Raha Beach.
  7. Al Sadyat Island.
  8. Al Reef.
  9. Masdar City.

Real estate ownership regulations for foreigners in Abu Dhabi

The Property Law No. 19 of 2005 in Abu Dhabi governs property ownership for foreigners within the freehold zones. It provides various investment opportunities in the real estate sector through different systems and contracts tailored for foreign investors.



Here are the details of these systems and the advantages they offer to foreign investors:

1.  Freehold Ownership System

This system allows foreigners to own a property in Abu Dhabi for a renewable period of 99 years. The investor receives a property deed granting full rights to utilize the property without owning the land. This includes the rights of sale, mortgage, and leasing.

2.  Strata Title System

Under this system, foreign investors are granted the right to use specific land and construct upon it for 50 years, renewable. After a period exceeding 10 years, the owner of the building on the land granted through strata title may manage it without the consent of the landowner.

3.  Usufruct Rights System

This system permits foreign investors to fully utilize a specific property for 99 years, renewable, without the need for the landowner’s approval when wishing to engage in transactions like selling, mortgaging, or leasing the property.

4.  Long-Term Lease System

The long-term lease system offers another option for foreign investors to benefit from properties in Abu Dhabi by leasing them for extended periods of up to 25 years.

The legal framework for real estate ownership in Abu Dhabi

The Department of Municipal Affairs and Transport in Abu Dhabi is responsible for overseeing the registration and documentation of property ownership, leasing, and property mortgages. Additionally, it grants the necessary permits to facilitate real estate transactions by the existing laws.

Transactions involving the purchase and sale of properties between developers and foreign buyers in Abu Dhabi are regulated by the Executive Regulations of Law No. (3) of 2015. These regulations outline specific guidelines:

  1. All real estate transactions must be registered in the Real Estate Development Register at the Department of Municipal Affairs and Transport before engaging in any property-related activities in the Emirate.
  2. Professionals such as real estate brokers, developers, surveyors, or appraisers are required to be registered in the Real Estate Development Register.
  3. Developers are mandated to clearly and precisely declare the terms and specifications of the property unit in the sales contracts based on the blueprint.
  4. Property developers must possess a project guarantee account corresponding to the blueprint.
  5. Buyers are to pay for the property based on the actual construction completion percentage unless otherwise agreed upon.
  6. Both the property developer and the buyer retain the right to terminate the sales contract based on the blueprint if either party violates the contract terms.
  7. Verification of compliance with all documentation and requirements for property transfer is essential.

Property transfer fees in Abu Dhabi

In Abu Dhabi, the government imposes fees on property transfers, whether for citizens or foreign investors, which vary based on the property’s type, value, and location.

These fees for property transfer include:

  1. Electronic contract registration fees amounting to 2% of the property price, except for investors purchasing directly from property developers.
  2. Agency fees of 2% of the property price if the transaction is conducted through a real estate agent.

It’s important to note that Abu Dhabi’s laws prohibit property developers from charging any fees on real estate transactions, except for administrative fees, which are subject to a maximum set by the Department of Municipal Affairs and Transport.

In conclusion

The government has taken steps to introduce legislation and laws governing the ownership of properties by foreigners in Abu Dhabi. This covers ownership methods like freehold, leasehold, usufruct, and long-term leasing contracts.

Additionally, specific investment zones have been designated by the emirate, allowing unrestricted property ownership for expatriates. These zones aim to attract more foreign investments and capital while ensuring fairness and transparency.

For further details about the laws and guidelines concerning foreign property ownership in Abu Dhabi, don’t hesitate to contact Realty Zone‘s team for a free real estate consultation.

If you’re considering owning property in Abu Dhabi’s prime freehold areas, get in touch with us now to explore a diverse array of luxurious properties and select the one that suits you best.

Edited by: Realty Zone©


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