Topic · updated 31.07.2026 · 5 min read · Lucent Legal team
Buying property in Dubai: legal risks and disputes
Key points
- Law No. 8 of 2007 requires developers to hold off-plan buyers' payments in a separate escrow account controlled by an agent bank, not in the developer's own operating account.
- The DLD charges a 4% registration (transfer) fee on the property price; officially it's split 2%/2% between seller and buyer, but in practice the buyer usually ends up paying the full 4%.
- The sale and purchase agreement (SPA) typically includes a grace period beyond the stated handover date — sources cite 6 to 12 months — and a delay only becomes legally actionable once that period runs out.
- Disputes over officially cancelled or frozen projects don't go to ordinary court — they go to a Special Tribunal, created by Decree No. 21 of 2013 and expanded by Decree No. 33 of 2020.
- Since 1 February 2023, if a non-Muslim in the UAE dies without a will, their assets default to Federal Decree-Law No. 41 of 2022 (50% to the spouse, the rest split equally among children) rather than Sharia inheritance rules.
The Dubai property market isn't governed by marketing promises — it's governed by specific laws and two regulators: the Dubai Land Department (DLD) and its subordinate body, RERA (Real Estate Regulatory Agency). The core rule for any off-plan buyer: your money has to go into a separate escrow account controlled by an agent bank (Law No. 8 of 2007), not straight to the developer. That doesn't eliminate the risks of any given deal — delays, hidden costs, outright fraud schemes — but it does give a buyer a clear line of defense, from a free DLD check to a RERA complaint to a dedicated court tribunal.
Before you buy: checks and general risks
Before you send a first payment, get the full picture of market risk — not just off-plan specifics, but hidden costs, banking friction for foreign buyers, and how inheritance works — then verify the specific project and developer through DLD's official tools.
- What can go wrong when buying property in Dubai — read this first if you're still choosing a property: hidden costs, liquidity, sanctions exposure, and inheritance risk.
- How to check a developer's escrow account before buying off-plan — read this before you make a specific payment: a step-by-step escrow and license check via Dubai REST, takes about 10 minutes.
If the project is delayed
The handover date in the SPA isn't a guarantee — but it's not a blank check for the developer either. A delay has legal limits, and there's a defined complaint procedure.
- Developer isn't handing over the unit on time: what to do about off-plan delays — read this once the SPA handover date has already passed: when a delay counts as a breach, where to complain, and what you can realistically recover.
If you suspect fraud
This is a separate, more serious category — not a delay, but a deliberate scheme: sales routed around escrow, double-selling a unit, a fake guaranteed-return promise, or a project that doesn't actually exist.
- Developer fraud in Dubai: the real schemes and how to get your money back — read this if you suspect deliberate fraud rather than a delay: the schemes that come up, where to go — DLD/RERA, the tribunal, or the police — and an honest read on your chances of recovering the money.
FAQ
What laws and regulators govern buying property in the UAE?
The key institutions are the Dubai Land Department (DLD) and its subordinate RERA. The main laws are No. 8/2007 on escrow accounts, No. 13/2008 on the Oqood pre-sale registry, and, for cancelled projects, Decrees No. 21/2013 and No. 33/2020 establishing the Special Tribunal.
How do I check a deal is safe before I transfer money?
Free DLD tools — the "Real Estate Project Status" (Mashrooi) feature in the Dubai REST app, or dubailand.gov.ae — let you check a project's registration, its escrow account details, and the developer's and broker's license (Trakheesi) in about 10 minutes.
What's the difference between a normal handover delay and developer fraud?
A delay involves a real, registered project that simply missed the SPA's grace period; the route is a RERA/DLD complaint. Fraud means sales routed around escrow, double-selling, a fake return promise, or a project that never really existed; alongside RERA, that usually also means a police report.
Does filing a RERA complaint guarantee you get your money back?
No. Neither a RERA complaint, nor the Special Tribunal, nor a regular court guarantees a full or fast refund — the outcome depends on how much is actually left in the escrow account, how far the project got, and whether the money has already been moved out of the UAE.
Sources
- Dubai Law No. 8 of 2007 on escrow accounts for off-plan real estate development
- Dubai Law No. 13 of 2008 on the interim (Oqood) real estate register
- Dubai Decree No. 21 of 2013 and Decree No. 33 of 2020 on the Special Tribunal for cancelled projects
- Federal Decree-Law No. 41 of 2022 on civil personal status (non-Muslim inheritance)
- Dubai Land Department — dubailand.gov.ae and the Dubai REST app (project status, escrow and Trakheesi license checks)
This material is for information only and is not legal advice. UAE law changes — a lawyer will assess how it applies to your situation.