In 2002 The Government Of Dubai Created Freehold Property Zones In The City

Category: Finance, Real Estate.

In 2002 the government of Dubai created freehold property zones in the city. This has resulted in an unprecedented boost in the real estate market leading to massive construction projects that are among the best in the world.

For the first time foreign individuals could own property in the freehold areas of Dubai. The new law was established in order to enhance the confidence of property buyers in the legal system. Before the law was passed foreign nationals could only get a 99- year lease at a maximum but it was only since 2002 that they could actually own property in the freehold areas of Dubai. The legislation was intended to attract foreign investment through international developers that always prefer to work in countries where the laws are straightforward and keeps things simple. Another good thing about the legislation is that it helps to support 80% of Dubai s population, made of non citizens, to rent out the property and lead better lives. According to the new laws people looking for buying property in Dubai will now have outright ownership of the construction as well as the land below it.

Freehold property owners in Dubai can rent out their property on 99- year leases of their own. There will no going back between freehold and leasehold. The best part of all this is that the Dubai Land Department uses the latest technology to manage everything so there is no need to worry about endless paper work and fussy rules and regulations. The new Dubai property law means that you can register the property under your own name with the Dubai Land Department. Everything is designed to work smoothly for everyone. The contract included an agreement that the freehold property would be granted as the freehold title as soon as it was ready.

Before 2002 the buyers kept a contract of the sale from the developer that allowed them to transfer the ownership only through the developer. The new law says that the title deeds can be handed over the owners a lot sooner. The resale market is boiling hot and international banks, especially Standard Chartered Bank, are vying to enter the market to offer financial loan options. A huge impact of all this can be seen in the mortgage market because of the high rate of construction and property trading going on in Dubai. Hitherto the same institutions were unwilling to enter the market because of legal uncertainties. Introductory discounts are going to make a huge difference to the mortgage market.

It is now fully expected that many banks are going to aggressively enter the market and lower the mortgage cost and offer highly competitive prices and several new services. It has generally been noted that the lower the cost of the money the higher the price of property. The new law will make it sure that there will be many new buyers because of financing available and there will be a lot of movement in the mortgage market with people switching to better lenders. One of the reasons for high rates of property in the world is the low cost of money.