If there’s one thing that is always changing in the Pearl of the Gulf, it would be its skyline. It seems like every time we pass through the grand streets of Dubai, a new skyscraper has been built, or a new community is being talked about all around the city. With the rapid speed that development is being carried out in Dubai, many investors find themselves signing Sale Purchase Agreements (SPA) on property purchases without the proper knowledge on how to protect their rights.
Navigating the real estate market in Dubai is exciting, but it can also be a complex process for investors, especially without adequate knowledge of the rules and regulations. However, ensuring that you are fully prepared and equipped with the knowledge you need before making a decision to invest in a specific property can save you time, effort, and money. After you decide which type of property you’re interested in investing in or purchasing, and before you seal the deal with an SPA, here are a few things you need to make sure your rights are protected:
Request to See the Developer’s License and Registration Record of the Project
The first and arguably most important thing you need to do before signing an SPA is ask to see the developer’s license. Always check to make sure that the developer is registered with the Dubai Land Department (DLD). Additionally, you can check the DLD’s website which includes a registry of developers in order to verify if the developer you’re planning to sign the SPA with is on the “licensed real estate developers” list. Additionally, the DLD’s website also includes a list of approved projects which you can refer to before signing the SPA. Furthermore, make sure a registration record for the project is requested, as all real estate projects in the emirate of Dubai must be registered with either the DLD or Oqood as authorized by the Real Estate Regulatory Department (RERA). You can find all of this information by visiting the DLD website.
Request to See a Copy of the Title Deed
The Title Deed, which is a document that proves ownership of a property, is an essential document that you should request to see prior to signing the SPA. After examining the Title Deed, make sure that the name of the property owner is correctly stated in the SPA before you sign. It is important not to overlook conducting a thorough and careful review of the rights awarded to the owner of the property, in addition to any restrictions that may apply. You can also ask for a copy of the master community declaration which outlines the nature of the property use and any associated rights.
Review the Payment Obligations
Because the SPA often imposes extensive payment obligations on the buyer, ensuring that the payment provisions are strictly adhered to is very important. Make sure your rights are protected and avoid disputes that could possibly occur by carefully examining the payment schedule and making sure it is linked to the construction and/or handover of the property.
Review Termination and Refund Clauses
While some real estates are developed and handed over during the timeframe that was previously promised and agreed upon, some of them don’t. In this case, it is imperative that you are aware of your rights as a buyer. Don’t overlook the termination clauses, which are some of the most important details to pay attention to prior to signing an SPA. make sure the clauses include details of termination and refund should the developer not meet the agreed deadline for construction/handover.
Verify the Details of the Escrow Account
You should verify the details of the escrow account, which is an independent third party entrusted with holding the funds before they are released, with the developer and the Real Estate Regulatory Agency (RERA) before signing the SPA and making any payments.
Consult a Lawyer
The SPA and any legally binding document must be in full compliance with the laws of the UAE. We advise you to consult with a team of real estate lawyers to ensure your rights are protected. Our team of experienced real estate lawyers at Khawla Saeed Advocates & Legal Consultants can guide you through the process while ensuring that all the legal requirements are met and can review the SPA before you sign it, eliminating any doubts you might have and saving your time, money, and most importantly, peace of mind.
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