Freehold and free zone are two terms that are often used in the UAE real estate market. They are the result of the gradual entry of the UAE into international relations. The fact is that the UAE have not always been open to the world community, and for a long time, foreigners could not purchase local real estate.
With the development of the state, overseas investors and entrepreneurs have more opportunities, including special areas. Now, foreigners can buy villas for sale in Dubai and other emirates, but only in a certain territory. Ax Capital, a trustworthy real estate agency in Dubai, can tell you more about the features of freehold and free zone.
Freehold real estate in Dubai is located in government–designated areas where non-Persian Gulf citizens can own a property. These districts were created in accordance with Law No. 7 of 2006 on land registration in the Emirate of Dubai. Article 4 of the law gives non-citizens of the UAE the right to purchase real estate in certain areas and register their rights with the Dubai Land Department (DLD).
Popular freehold areas
The most popular freehold areas in the city are:
- Downtown Dubai;
- Dubai Marina;
- Palm Jumeirah;
- Old Dubai;
- Emirates Hills;
- Jumeirah Beach Residence;
- Discovery Gardens;
- Jumeirah Lakes Towers (JLT);
- The Lakes;
- The Springs;
- Dubai Investment Park;
- Arabian Ranches and others.
Most neighborhoods are freehold, which means foreigners can look for apartments for sale in Dubai.
Who can buy off-plan projects in Dubai in freehold areas?
Investors who want to purchase real estate for income, or expatriates who want to buy off-plan properties for sale in Dubai or become the owner of a ready-made home.
The advantages are:
- the owner has control over the property;
- the owner can rent out the property, resell and change it;
- freehold areas offer investment opportunities.
Free zone features
Free zones are special economic zones created to provide preferential customs duties to foreign investors and companies. They have a special system of rules and regulations established by the authorities.
Popular free zones
- Dubai Healthcare City;
- Dubai Internet City;
- Dubai International Academic City;
- Dubai Airport Free Zone;
- Dubai Knowledge Village;
- Dubai Cars and Automotive Zone (DUCAMZ);
- Dubai International Financial Centre;
- Dubai Media City and others.
Who can buy a home in free zones?
Free trade zones are preferred by overseas companies wishing to work in the UAE and retain 100% ownership.
The advantages are:
- there is no need to involve a local partner;
- investors can own 100% of the company’s shares;
- special privileges and great flexibility;
- no restrictions for performing more than one action.
- tax exemption.
Important! Companies are allowed to operate only within the free zone in the UAE, which limits their ability to expand their business.
If you want to invest in real estate to become a homeowner/lessor or resell a property when it is profitable, you should invest in freehold areas.
If you want to invest in real estate to start a business and want to be the sole owner of the company, we recommend you invest in a free zone.
Where can you invest in Dubai right away?
When it comes to choosing a place to purchase a property, future buyers have the following options: purchase for resale or rental.
Purchase for sale
Potential investors should pay attention to the Expo 2020 international exhibition and its surroundings – Dubai Investment Park and the areas adjacent to Al Maktoum International Airport. This location will become self-sufficient, with all the amenities for a comfortable stay.
Apartments in Dubai Investment Park cost from AED 285,000 ($77,500, ¥536,000). As the new district is built up, this number will grow, thereby ensuring the long-term investment.
Purchase for rent
Investors wishing to purchase real estate to rent it out should consider several factors, such as rental yield and ROI.
Many tenants are moving from central to more affordable districts. People are leaving premium and middle-income areas, such as Downtown, The Palm Jumeirah, Dubai Marina, The Greens, Discovery Gardens, Dubai Silicon Oasis or JVC. This means that buying a property in the areas listed below is a good choice in rental profitability and return on investment.
Below is the current value of property for sale in Dubai by district:
- apartments in Discovery Gardens – from AED 470,000 ($128,000, ¥885,000);
- flats in Dubai Silicon Oasis – from AED 350,000 ($95,200, ¥658,400);
- apartments in Jumeirah Village Circle – from AED 410,000 ($111,600, ¥771,000);
- properties in Jumeirah Village Triangle – from AED 400,000 ($109,000, ¥752,500);
- flats in Dubai Sports City – from AED 360,000 ($98,000, ¥677,000).
You can buy flats in Dubai with Ax Capital
The Ax Capital website presents the cost of property in Emaar Beachfront and other sought-after communities. Here, you can always get professional advice on purchasing and selling housing from leading market experts, who will help you pick up a home and prepare the necessary documents.