The Abu Dhabi government’s move to change a real estate rule to allow expats to own freehold property in designated zones is a step in the right direction to put the capital’s property market on the global map and a boon for private developers and investors alike, market analysts and property developers say.
Under the new rules, freehold registration fees will be 2 per cent of the price of each unit, compared with 4 per cent leasehold.
Earlier, ownership of land was only permitted to citizens of the UAE and GCC countries. Under the legislative changes, land and residential units in designated investment zones can be registered under Abu Dhabi’s freehold law, with property ownership deeds issued to investors. Foreign investors were only allowed leasehold arrangements for a maximum of 99 years.
“The new rules will not only drive the maturity of Abu Dhabi’s property market, but increase transparency and provide clarity of title for property owners, increasing long-term investment and injecting more liquidity, and encouraging longer-term residency,” said Talal Al Dhiyebi, Aldar Properties’ chief executive. “Indian and Chinese investors are targets for the UAE.”
On Wednesday, Abu Dhabi issued a Decree that allowed freehold rights on land for individual investors of foreign origin and foreign-owned businesses in investment zones. There are as of now up to 30 such zones designated as such. Public-listed companies with up to 49 foreign ownership can also own land and build in the emirate.
That apart, it also allows “Foreign owners to put the land on a mortgage, sell it, inherit it and enjoy the full rights that come with free and full ownership,” said Falah Mohammad Al Ahbabi, chairman of the Urban Planning and Municipalities Department.
According to Jassim Al Siddiqi at the developer Imkan, “What’s important to me is that the law allows listed companies to buy land anywhere in Abu Dhabi. This is positive not only for individual foreign investors but also to locally listed companies.”