| |
| Real Estate Laws & Procedures in Abu Dhabi |
Abu Dhabi's property law came into effect on the 14th of August 2005, when Abu Dhabi's government announced the permitting of 99-year land ownership and renewable 50-year surface ownership to foreigners in specified areas in Abu Dhabi. |
 |
|
Law No. 3 of 2005: Regulating the Registration of Real Property in the Emirate of Abu Dhabi |
This Law regulates the registration of real property (defined as buildings or structures on the land and includes all rights and privileges related to the land) within the Emirate of Abu Dhabi. The law provides for the establishment of a Land Registration Department at both the Abu Dhabi and Al-Ain Municipality Departments. |
 |
The primary function of these Land Registration Departments is to establish a real property register; register dispositions of real property; attest the parties signatures to deeds which are to be registered; file original deeds and provide copies if required; and issue search certificates. |
|
Fundamentally important to property ownership is that every deed creating, transferring or extinguishing real property rights shall, between those concerned and against others, be ineffective unless it is evidenced by registration. This similarly applies to leases exceeding four years, in that unregistered leases shall have no effect other than the personal obligations that those concerned would have towards each other. |
The Law further provides that UAE nationals may sell or purchase residential, commercial, investment or agricultural land allotted to them (other than industrial land or land leased from the Municipality), with the main provision being that at least five years must have passed since the date of such allotment. |
The Law also schedules the various fees payable to the Land Registration Department which include fees for selling, mortgaging and registration of leases. |
|
| Law No. 19 of 2005: Regarding Property Ownership in the Emirate of Abu Dhabi |
This Law was signed by HH Sheik Khalifa bin Zayed Al Nayhan, Ruler of Abu Dhabi, on 10th August 2005 and applies locally within the Emirate of Abu Dhabi (including Al Ain). It contains provisions for ownership, development, leasing and mortgaging of land and property and differentiates between the rights of UAE nationals, GCC nationals and non-UAE nationals. |
 |
In terms of the Law, UAE nationals and legal entities wholly owned by them, have the right to freehold ownership to property anywhere in the Emirate of Abu Dhabi. As an exception to the above, the Law grants GCC nationals the right to own freehold land within designated areas known as Investment Zones. |
|
| The Law also grants non–UAE and GCC nationals the right to own apartment units or entire floors in buildings in the Investment Zones. However, right of ownership of an apartment unit or floor in a building does not include by association, a right to a share in ownership of the underlying land on which the building is situated. Non-UAE and GCC nationals may also acquire a right of usufruct (the right to use and exploit property belonging to another person) for a period of up to 99 years and a right of musataha (the right to build and develop on the land belonging to another person) for a period of up to 50 years, both being renewable by mutual consent. These ‘ownership’ rights are principal rights in rem and the Law recognizes that they are capable of being sold, mortgaged, pledged or assigned. |
The Law allows for the inheritance of real property rights and upon death, ownership rights in the property will be registered in the names of the successors of the deceased after the presentation of evidence proving their entitlement to inherit. Where the successor is not a UAE or GCC national, and the inheritance is for ownership of land or property rights which he may not own under the terms of the Law, he will not be entitled to take such title but must instead sell his interest. This can be ordered through the courts where necessary.
The Law was amended in February 2007 to permit non-UAE nationals to own floors (excluding the land) of buildings situated in any of the investment zones. This right of ownership is not true ‘freehold title’ in its traditional sense as the right does not extend to ownership of the actual land itself rather just the unit built upon it.
Despite the ‘silence’ of the Law over true freehold ownership of land by non-UAE nationals, a number of developers in the Emirate are nonetheless marketing buildings to purchasers as granting freehold title.
Meanwhile, the sales of residential real estate in Abu Dhabi were expected to reach $2.45 billion in 2007.
Around one-third of the estimated $817m in sales in 2006 were through mortgage lending, according to a report at the Abu Dhabi Economic Forum.
“The emirates property law which gives the buyer a 99-year leasehold title will be adequate enough to spur growth,” it was reported. |
| |
