Previously, according to the UAE’s real estate law, expats living across all the Emirates were not allowed to own a property. However, amendments were made to the real estate law to allow non-UAE nationals to buy and own properties based on certain conditions. Also, foreigners are only allowed to invest/buy freehold properties in designated areas of the capital city. Hence, before you buy a villa in Abu Dhabi or an apartment, you must be well aware of the property buying rules for foreigners in the Emirate.
Today, we will go through Abu Dhabi property laws for expats, as the ownership rules differ for non-UAE nationals.
ABU DHABI PROPERTY OWNERSHIP LAWS FOR EXPATS
Our guide to Abu Dhabi property laws for expats will help Non-UAE nationals and overseas investors interested in buying a property to understand the ins and outs of ownership in the Emirate.
The Abu Dhabi real estate sector Law No.19 of 2005 allows foreigners to own properties through four main systems. These systems are detailed as under:
Ownership Deeds
Non-UAE nationals are given ownership deeds for 99 years of the residential properties in the capital city. Under this system, expatriates can dispose of their property (villa or apartment).
Musataha
Under the Musataha contract, foreigners in Abu Dhabi are allowed to own residential property for 50 years. Also, the period of ownership is renewable for the same period as the concerned parties. The non-UAE nationals owning the residential unit can not only use it but are also allowed to construct or alter the property within the given time frame.
Usufruct
Under the Usufruct system, foreigners in Abu Dhabi can own and use the residential property for 99 years. Though they are allowed to use the facilities of the property, they are not allowed to alter any.
Long-term lease
A long-term lease is given to expatriates on their property for an initial duration, which is not less than 25 years.
AMENDMENTS IN ABU DHABI PROPERTY LAWS FOR EXPATS
In 2019, the government of Abu Dhabi amended the real estate laws related to the property owner of expatriates. Previously, non-UAE nationals were only allowed to own freehold apartments, villas, and offices, not lands. But the new changes in the law allows non-UAE nationals and foreign legal entities to own freehold land as well in the capital city. Moreover, according to the new amendments in the property buying rules for foreigners in Abu Dhabi, expats can own and acquire all rights on the property, they buy in Emirate’s investment zones.
The amendments in property buying rules for expats in Abu Dhabi were made to boost the economy, develop investor services and maximise direct investment.
The Abu Dhabi property laws for expats specifies changes to Article 3 and 4. As per Article 3 (i), the right for property ownership in the Emirate is restricted under three categories. That is as under:
- Citizen or legal person
- Public holding companies with foreigners’ ownership are not more than 49%
- A person who has received a decision from the Executive Council’s President or Abu Dhabi’s Crown Prince
Besides, Article 3 (ii) specifies that expatriates or legal persons are allowed to acquire and own all the rights on their property in the investment zones.
As per Article 4, non-UAE nationals with Musataha or Usufruct contract for 10+ years are allowed to dispose of the property, without the landlord’s consent, which also includes the mortgage right. Except with the consent of Musataha or Usufruct contract holder, the landlord may not mortgage the property. The parties may agree otherwise in both cases.
Hence, according to the amendments in the Abu Dhabi property ownership laws for expats, non-UAE nationals can also dispose of principal rights as well as freehold ownership. They can also associate property rights and mortgage rights over properties in Abu Dhabi’s investment zones.
WHERE CAN EXPATS BUY PROPERTY IN ABU DHABI?
According to the Abu Dhabi property laws for expats, non-UAE nationals can only buy freehold property in designated areas of the capital city. For now, they can buy/invest in properties available in Al Reef, Yas Island, Masdar City, Saadiyat Island, Lulu, Sayh Al Sedairah, Mariya, and Al Raha Beach.
DO EXPATS GET A RESIDENCE VISA ON BUYING A PROPERTY IN ABU DHABI?
Based on certain conditions, expats are eligible to get a residence visa on buying a property in Abu Dhabi. The conditions to get a residence visa are
- The minimum value of the property should be AED 5M.
- The property should not be bought on a mortgage
- If the expat retains the property with themselves for three years
CAN NON-UAE NATIONALS APPLY FOR A MORTGAGE IN ABU DHABI?
Yes, expats can apply for a mortgage to buy property in Abu Dhabi. They can contact lenders operating in the Emirate for home loans. However, a few conditions apply. For instance, expats who have been at their current job for a year or a minimum of six months can apply for a mortgage. Secondly, if the non-UAE national is self-employed, then his business should have been established for a minimum of two years. Moreover, those expats who opt to buy an apartment in Abu Dhabi, land or villa, worth up to AED 5 million, then they are required to make a down payment of 20 – 25 percent of the mortgage value. For property worth above AED 5 million, the down payment will be up to 35% of the mortgage value.
FAQs
Can foreigners own property in Abu Dhabi?
Yes, foreigners can own property in Abu Dhabi within designated investment zones.
What happens after a 99-year lease in Abu Dhabi?
After a 99-year lease, the property reverts to the freehold owner unless the lease is renewed.
Is it good to buy property in Abu Dhabi?
Yes, purchasing property in Abu Dhabi is a good investment, offering strong growth potential, solid rental income and stable legal frameworks.
Here our guide to property buying rules for foreigners in Abu Dhabi comes to an end. For other Emirates, the property buying rules for expats may differ. Its better that you go through the important essentials for buying property in UAE for expats to avoid any inconvenience.
If you are a non-UAE national interested in investing in a property, make sure you go through the ways to minimise property investment risks. Also, it is recommended to hire a real estate agent, an expert in the area you are interested in to buy a property. If you are planning to invest in land in the designated investment zones for expats, then you can browse through these many lands for sale in Abu Dhabi.
Stay tuned to the UAE’s property blog for more information on different property buying and selling laws, rental contracts and more.
