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Leasehold and Freehold
Understanding Property Ownership in the UAE
When buying property in the UAE, it’s important to understand the difference between leasehold and freehold, as they determine your ownership rights.
What is it?
Full ownership of the property, including the land it stands on.
Who can buy?
Foreign buyers can purchase freehold property in designated areas (Freehold Areas).
Ownership term:
Ownership is permanent.
Owner’s rights:
— Full control over the property (sell, rent, gift, or pass on as inheritance).
— Full benefit from property value appreciation.
Popular freehold areas:
— Dubai: Downtown Dubai, Palm Jumeirah, Dubai Marina.
— Abu Dhabi: Saadiyat Island, Yas Island.
What is it?
A long-term lease, usually up to 99 years.
Who can buy?
Foreign buyers can lease property, but the land remains owned by the developer or the government.
Ownership term:
A fixed period (typically 10 to 99 years).
Tenant’s rights:
— Can use and sublease the property but does not own the land.
— Lease renewal is possible but not guaranteed.
Popular leasehold areas:
Sharjah and Ajman, as well as some zones in other emirates.
Freehold
What is it?
Full ownership of the property, including the land it stands on.
Who can buy?
Foreign buyers can purchase freehold property in designated areas (Freehold Areas).
Ownership term:
Ownership is permanent.
Owner’s rights:
— Full control over the property (sell, rent, gift, or pass on as inheritance).
— Full benefit from property value appreciation.
Popular freehold areas:
— Dubai: Downtown Dubai, Palm Jumeirah, Dubai Marina.
— Abu Dhabi: Saadiyat Island, Yas Island.
Leasehold
What is it?
A long-term lease, usually up to 99 years.
Who can buy?
Foreign buyers can lease property, but the land remains owned by the developer or the government.
Ownership term:
A fixed period (typically 10 to 99 years).
Tenant’s rights:
— Can use and sublease the property but does not own the land.
— Lease renewal is possible but not guaranteed.
Popular leasehold areas:
Sharjah and Ajman, as well as some zones in other emirates.
Key Differences
Conclusion
For long-term ownership and investment, freehold is more attractive as it provides full ownership rights. Leasehold can be convenient for those looking for temporary housing or more affordable options with fewer obligations. The choice between them depends on the purpose of the purchase and the planned duration of property use.