Types of Property in Dubai: Studios, Villas, Apartments

9:34 pm  |  10.08.2023

Dubai’s real estate market has grown almost fourfold over the past year. The emirate is now one of the world’s most popular locations where foreigners purchase real estate.

Most foreign citizens buy objects for the purpose of further profitable resale or leasing, but there are those who plan to stay in the country for a long time. In both cases, there are nuances: Dubai’s real estate market has a number of features to know.

How to Own Property in Dubai

There are several options for owning property in Dubai. However, not all of them are available to foreigners. Let’s deal with the basic.

  • Leasehold – a form of ownership of real estate, which is a long-term lease option: the buyer acquires the right to use the object for a very long time – up to 99 years. At the same time, he has the right to repair and rebuild the facility, make it redevelopment, and make other changes, as well as sublet. 
  • Freehold – the most common type of property rights for foreigners is full ownership, meaning they can sell, bequeath, rent, and pass on ownership of the land where apartments, townhouses, and cottages stand.

The advantage of such an acquisition is that the owner can claim the status of a resident of the UAE if the amount of purchase is sufficient for this. A resident visa for three years can be obtained when buying an object worth 750 AED ($204 000). The investor is free to choose a finished object or a building from an accredited developer. Applicants are also eligible for a mortgage if the down payment is more than 50%.

Purchase of real estate can provide a «gold visa», which is issued for 10 years. The minimum investment of own funds in this case should be at least 2 million AED ($545 000).

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Freehold property in Dubai has been allocated special areas. In total, the emirate has more than 70 free zones, in which foreign citizens can own property under full ownership. In the rest of the areas, expats are only available for rent.

The purchase of objects on Freehold is more expensive than on Leasehold, which is largely due to the location of the areas themselves and their prestige.

For an ordinary home buyer, it is enough to get acquainted with the form of Freehold, most foreigners use it in real estate transactions. 

Musataha – the right to use and develop a plot of land and profit from it for a certain period of time. This form is mainly used by developers. Usually, the period of use of the site does not exceed 50 years, but if necessary, it can be extended.

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Following the Musataha contract, the developer has the right to build a property in Dubai on a specific site. In this case, all objects built on this plot belong to the developer, and he can manage them at his discretion.

Usufruct – this term can also be encountered. This form is similar to Leasehold: the object is leased for a long-term lease of up to 99 years. In this case, Usufruct allows free use of real estate and receives income from it, but prohibits any modification of the facility.

What Types of Property You Can Buy in Dubai

The types of real estate in Dubai are not too different from European. In the local housing market, you can buy apartments, townhouses, penthouses, and detached houses.

The most popular housing options for foreigners in Dubai are budget-friendly, compact apartments. Large villas and penthouses are less popular due to foreigners typically moving without their families. Compact apartments are not only more convenient for living but also better for renting out.

Apartments – one of the most popular choices for investments

Apartments. As a rule, they consist of rooms with one or more bedrooms, a guest area, a kitchen, and one or more bathrooms.

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Penthouses. This is a one or two-story apartment on the upper floors of high-rise buildings, they belong to premium housing. Penthouses have a large area (300 sq. meters and more), often sold with designer repairs and expensive furniture, but their main advantage – dizzying views from the windows.

The territory of the villa almost always has a garden and swimming pool, and the house is from 2 to 10 bedrooms and premises for various purposes.

Villas. The main buyers of this type of property are the Arabs themselves, but there are foreign buyers in this segment too. These objects belong to the luxury, representative segment. They can be located inside prestigious neighborhoods or on the beach and have their own access to the beach.

Townhouses. This is a budget version of the villa and a fairly common type of real estate in the UAE. The townhouse is a two or three-story house for multiple owners, where all residents enjoy a separate entrance from the street and their own small plot in front of the house. Many townhouses in Dubai, like villas, are built by the sea.

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