Recent Developments in Real Property Procedures

Recent Developments in Real Property Procedures

Real Property


The sale and purchase of properties in Dubai, is of course, subject to transfer fees being paid to Dubai Land Department which amount to 4% of the property sale price or the average sale price of similar properties (whichever is the higher of the two). However, this transfer fee is substantially reduced to 0.125% of the value of the share of the property (as determined by a supporting Dubai Land Department Valuation Certificate) to be transferred, where the seller wants to transfer ownership (or part ownership) to a relative of the first degree – e.g. father to son, daughter to mother, husband to wife, by way of gift – i.e. without payment of valuable consideration for the property. This process is known as “gifting”.

There have been some recent developments in this area of gifting. It is now only possible to benefit once from the reduced transfer fee by way of gifting a property. This would affect anyone who would previously have been able to circumvent the rule of only being able to gift to first degree kin, e.g. where a step-father wanted to gift to his step-daughter, he could previously gift the property to his wife, who in turn could gift to her daughter. It is now no longer be possible to benefit from the second gifting fee reduction, so the full transfer fees of 4% would be payable on the second transfer.

Also, where the property is to be transferred from husband to wife (or vice versa) the notarised wedding certificate (where married outside of the UAE) will now need to bear a Ministry of Foreign Affairs stamp dated within a year of the “gifting” date.

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