SPA
The Sale and Purchase Agreement is the binding contract between an off-plan buyer and the developer, setting the price, payment schedule and completion date.
What SPA means for a buyer
The SPA is the contract you sign with a developer when buying off-plan, usually a few weeks after paying the reservation fee. Once signed it is registered with the land department: in Dubai through Oqood, in Abu Dhabi with ADREC.
It is drafted by the developer and is rarely negotiable, so the task is to understand it. The clauses that matter most are:
- Anticipated completion date and how far the developer may extend it. Extensions of up to a year without compensation are common.
- The payment plan and what triggers each instalment: a calendar date or a certified construction milestone.
- Default. In Dubai, Law No. 13 of 2008 lets a developer, after 30 days' notice through the DLD, terminate and keep up to 40% of the price where the project is at least 60% built, or up to 25% below that.
- Area and specification. Developers allow themselves a tolerance; Dubai's rules require compensation if the net area is more than 5% smaller than agreed.
- Resale. The share of the price you must pay before an assignment is permitted.
- Fees at handover and the estimated service charge, which is not binding.
Where English and Arabic versions differ, a UAE court will follow the Arabic. Pay a property lawyer to read the SPA before the reservation period expires; it costs little relative to the commitment.
Related terms
Guides that use this term
Where SPA comes up in practice, with the costs, rules and steps around it.
Questions about the buying process?
An adviser can explain how this applies to the property you're considering.
- Current price list and availability, direct from the developer
- No fee to you on off-plan purchases: the developer pays us
- One salaried adviser, not on commission, from first call to handover
