Major Real Estate Initiative Announced
Dubai has announced a major real estate initiative, allowing property owners of all nationalities in the Sheikh Zayed Road and Al Jaddaf areas to convert their holdings to freehold status. The move, revealed by the Dubai Land Department (DLD), is part of a broader strategy to strengthen the city’s position as a global hub for real estate investment. A total of 457 plots are eligible for conversion—128 along Sheikh Zayed Road, stretching from the Trade Centre roundabout to the Water Canal, and 329 in Al Jaddaf.
Freehold ownership grants investors full title to both the property and the land it occupies, offering greater control and long-term benefits. The DLD stated that the initiative is expected to enhance the market value of properties in these areas, boost their economic appeal, and attract fresh investment.
Expert Insights on Market Impact
Analysts say the decision could have far-reaching implications for foreign investment in Dubai’s real estate market.
Marwan Ahmed bin Ghalita, Director General of the DLD, emphasized that the move would drive significant growth in Dubai’s real estate sector, further cementing the emirate’s reputation as a global economic powerhouse and a top destination for property investment.
Strong Performance in Dubai’s Real Estate Market
The initiative comes on the heels of an extraordinary performance in 2024 for Dubai’s real estate market. Sales value reached AED 522.5 billion, marking a 27% year-on-year increase, while sales transactions surged to 181,000, up 36% YoY. The price per square foot rose to AED 1,500, reflecting a 12% YoY growth. Capital gains of AED 60 billion were recorded, forming 32% of the total resale market value, alongside AED 40.8 billion in rental income.
Future Growth Projections
Dubai’s real estate sector has already shown robust growth, with 188,000 transactions worth AED 625 billion ($170 billion) recorded as of November 2024, marking year-on-year increases of 38% in volume and 23% in value. The emirate’s Real Estate Sector Strategy 2033 aims to further expand the sector’s contribution to GDP to AED 73 billion, increase homeownership rates to 33%, and grow transaction volumes by 70% over the next decade.
Steps to Convert to Freehold Ownership
Property owners can follow these steps:
- Check eligibility: Via the Dubai REST app
- Apply for Conversion: Submit an application to the DLD for land assessment and valuation.
- Pay Conversion Fee: A conversion fee of 30% of the property’s valuation, based on gross floor area, will apply.
- Receive Title Deed: Once the fee is paid, a map and freehold title deed will be issued.
Why Freehold Matters
Freehold ownership differs from leasehold, where investors own the property but not the land, typically for up to 99 years. The Freehold Decree, enacted in 2002, allowed foreigners aged 21 and above to buy, sell, lease, and rent properties in designated areas. Benefits of freehold ownership include the ability to modify the property, pass it on to heirs, and enjoy long-term residency visas. Studies estimate that freehold properties in Dubai can yield returns of 7-10%, offering significant investment potential for those willing to wait for the right market conditions.
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