Buying off-plan property in the UAE: how it works and how buyers are protected

Buying off-plan means agreeing to buy a home that has not been built yet and paying for it in stages. In the UAE the buyer is protected by four mechanisms: the project must be registered with the regulator, your money must go into a project escrow account, your purchase must be entered on a government interim register, and the law limits what a developer can keep if the sale is cancelled. Those rules are real and enforced. They reduce the risk of fraud; they do not remove the risks of delay, default or a falling market. This guide explains each in turn for Dubai, with the Abu Dhabi and Ras Al Khaimah equivalents. It is general information, not legal advice.

How does an off-plan purchase work?

1. Reservation. You sign a booking form and pay a deposit, commonly 10% to 20%.
2. Registration fee. In Dubai you pay the 4% Land Department fee plus AED 1,020 for registration; in Abu Dhabi the fee is 2%.
3. Sale and purchase agreement (SPA). The binding contract. It fixes the price, payment schedule, specification, completion date and what happens if either side fails.
4. Interim registration. The developer registers the sale: on Oqood in Dubai, on the Initial Real Estate Register in Abu Dhabi.
5. Instalments. Paid into the escrow account according to the plan. See payment plans explained.
6. Completion and handover. You inspect, pay the balance and take the keys.
7. Title deed. The unit moves to the main register.

The four protections, and what each one does

Escrow: where your money goes

Under Dubai Law No. 8 of 2007 a developer selling off-plan must open an escrow account for that project with a bank accredited by the Land Department. Buyers' payments, and any project finance, go into it. A developer with several projects needs a separate account for each. The money is reserved for building that project, and when the building is finished the bank holds back 5% for a year after units are registered to buyers, as cover for defects. Misusing project funds carries imprisonment, a fine of at least AED 100,000, or both.

The practical rule that follows: pay only to the account named in your SPA. A request to pay a broker, a different company or an account abroad is a warning sign.

Abu Dhabi goes a step further on timing. Since the 2025 amendment, a developer cannot draw on escrow at all until 20% of construction is complete, unless the regulator approves an unconditional bank guarantee worth at least 20% of construction cost. Escrow money may not be used to pay for the land or brokers' commissions. Ras Al Khaimah's 2026 law requires the developer to fund at least 20% of construction cost itself.

What should you check before you reserve?

• Project status. Dubai: the Land Department's Project Status Enquiry. Abu Dhabi: DARI shows registration, the escrow account number and the completion rate. Ras Al Khaimah: ask RAK Municipality's Real Estate Regulatory Department to confirm the off-plan sale permit.
• Developer licence. The Dubai Land Department publishes a list of licensed developers and of approved escrow trustees.
• Advertising permit. Dubai adverts need a Land Department permit (Trakheesi), which can be verified on its website. Abu Dhabi requires its own permit and broker licence.
• Delivery record. How late were the developer's last three projects. See our developer pages.
• Who is selling. Check the broker on the regulator's licensed-broker list.
• The full SPA. Ask for it before paying the deposit, not after.

Which SPA terms matter most?

• Completion date and grace period. Many Dubai contracts give the developer 6 to 12 months beyond the stated date before you gain any right to cancel. A contract with an "anticipated" date and an open-ended extension gives you very little.
• Payment triggers. Are instalments tied to dates or to construction milestones. Dubai's regulations treat a developer's refusal to link payments to construction milestones proposed by the regulator as a ground for termination, and Abu Dhabi's law lists it as a developer breach.
• Default clause. It cannot lawfully exceed the statutory caps below, but check what it says about interest and notice.
• Specification and area. In Dubai the developer cannot charge for extra area and must compensate for a shortfall unless it is insignificant. Abu Dhabi adjusts the price beyond a 5% variance and lets you rescind beyond 10%. Ras Al Khaimah's 2026 law requires compensation for a shortfall over 5%.
• Resale before handover. The percentage you must have paid and the fee.
• Dispute forum. Court or arbitration, and where.
• Handover costs. Service-charge advances, utility connections, any "handover fee".

What happens if you stop paying?

This is where buyers lose the most money, so the detail matters.

Dubai: Article 11

The developer must notify the Land Department, which serves you 30 days' written notice and may try to mediate. If you neither pay nor settle, the Department certifies the project's completion percentage and the developer's options depend on it.

Percentages are of the unit price in the SPA, not of what you have paid. Any refund is due within one year of cancellation or 60 days of the unit being resold, whichever is earlier. The rules apply to contracts signed before the amendment too, and they do not apply to sales of land.

A conflict between sources. The last row follows the 2020 text published on Dubai's legislation portal, which has no deduction where construction has not started. The earlier 2017 version let the developer keep up to 30% of the amounts paid in that case, and that figure is still quoted in 2026 by some lawyers and newspapers. We have followed the official 2020 text. If this situation applies to you, take legal advice on which version governs.

Worked example. You buy at AED 1.5 million and have paid 30%, AED 450,000, when you stop paying at 40% construction. The developer may keep up to 25% of the price, AED 375,000, and must refund AED 75,000. If instead you had paid 50%, AED 750,000, and defaulted at 70% construction, it could keep up to 40%, AED 600,000, and refund AED 150,000. These are ceilings, and developers sometimes settle for less.

Abu Dhabi: Decision 165 of 2025

The notice period is longer, 60 days by notary or registered mail, and the deduction is fixed by a table: 10% of the contract value below 10% construction, 15% up to 30%, 25% up to 60%, 40% above that, and nothing if construction has not started for reasons outside the developer's control. The escrow trustee must pay your balance within 15 working days of your request. On the AED 1.5 million example, defaulting at 20% construction would cost AED 225,000 in Abu Dhabi against up to AED 375,000 in Dubai.

Ras Al Khaimah: Law No. 10 of 2026

Thirty days' notice through the regulator, then up to 40% at 60% construction or more, 25% below that, and up to 20% where construction has not started. See buying in Ras Al Khaimah.

What if the developer is late?

Delay is common. ValuStrat reported that about 33,000 homes had completed in Dubai by the end of September 2026, under a third of the number projected for the year.

Your position in Dubai:

• Delay alone does not cancel the contract. Lawyers are consistent on this. Start with the SPA's completion date, grace period and force majeure wording.
• Statutory grounds to terminate are listed in Article 20 of Executive Council Resolution No. 6 of 2010 and include a material departure from the agreed specification and a refusal to provide the final contract.
• If the project is still active, the Land Department will not cancel at your request. You would apply to the court, or to arbitration if the SPA says so.
• If the regulator cancels the project, the developer must refund all payments from escrow. Disputes over cancelled projects go to a special tribunal created by Decree No. 33 of 2020.
• Do not stop paying in protest. That can put you in default under Article 11 and hand the developer the stronger position. Write formally, ask for the completion percentage and revised date, and keep records.

Abu Dhabi's law is more specific. If construction has not started within six months, buyers holding 5% of the units can complain and the regulator may cancel the project and order refunds; a delay penalty applies once delivery is more than six months late.

Can you sell before handover?

Yes, by assigning your contract, subject to the developer's consent.

• The threshold. Most SPAs require a set share of the price to be paid before the developer will issue a no-objection certificate. It is set by contract, not by law, and varies widely. Get it in writing before you reserve.
• The fee. Dubai Law No. 13 of 2008 bars developers from charging fees on a resale other than administrative costs approved by the Land Department. In Abu Dhabi, Resolution No. 183 of 2017, published by the Abu Dhabi Real Estate Centre, caps developer administration fees at AED 5,000.
• The tax on your buyer. The new buyer pays registration again: 4% in Dubai, 2% in Abu Dhabi. That cost comes out of the price they are willing to pay you.
• The market. Dubai off-plan registrations in the third quarter of 2026 were 45.7% lower than a year earlier. A plan that depends on selling before the handover payment falls due is fragile.

The steps, the paperwork and a worked example of the arithmetic are in our guide to selling off-plan property before handover.

Snagging, handover and defects

When the building has its completion certificate you will be invited to inspect. Commission an independent snagging inspection, list every defect in writing and agree a date for repairs before signing the handover documents. From handover you are liable for service charges whether or not you move in: see service charges in Dubai.

Your statutory cover after that:

In Dubai the developer must file for title deeds within 60 days of the completion certificate. In Abu Dhabi moving the unit to the main register costs AED 1,000.

The full completion process, from the handover notice to the title deed, is in our guide to off-plan handover and snagging.

Is off-plan right for you?

Off-plan suits a buyer with reliable income or cash for every instalment, a horizon beyond the handover date, and no need for rent in the meantime. It does not suit someone counting on a mortgage they have not been offered or on a resale to fund the final payment. For a side-by-side view read off-plan vs ready property, then model the instalments in the payment plan calculator.