One of the rights of foreign property ownership in Abu Dhabi is the 99-year lease under which a buyer owns the property but not the land it sits on, this is owned by the government or a developer. This lease structure is common in many regions, especially in the regions that demand property and restrict ownership of land. It has certain specificity and difficulties sticking to it, but it offers quite many advantages at the same time. Overview Of 99-Year Leases While a 99-year lease is a legal relationship between the property owner and the actual owner of the land, which is most often the government or the developer. Even though the buyer takes full possession of the property, he or she does not own the real estate land. This leasing model is advantageous because it is an easy way for lessees to bypass the banned rule of foreign nationals from owning land in Abu Dhabi without outright purchase. Key Features Ownership of the Property: Purchasers can occupy, leasing, or subleasing, or selling the property as they wish during the Lease Period. Land Ownership: The land still belongs to the government or a developer. Renewal Option: At the end of the term of the lease, such lease may be continued for other terms as provided by the owner of the land. This structure is especially suitable for expatriates and international investors who are interested in penetrating into the rapidly growing Abi Dhabi property market. Pros Of 99-Year Leases The 99-year lease arrangement has some benefits that will justify its adoption for property purchase and investors in Abu Dhabi.   Long-Term Security A ninety nine year lease is a long lease and can give property owners time for individual or business utilization. Apart from guaranteeing the safety of investors’ money, it also deals in stocks with long-term stability.   Property Ownership Rights Despite the fact that the land is leased, the buyer himself becomes the full owner of the property. Leasing makes it possible to freely utilize a property for rental, sale, or even alteration as long as legal requirements of the lease contract have been met.   Market Access for Foreigners Non-UAE nationals are unable to own freehold land in many parts of Abu Dhabi due to the emirates real estate laws. The 99-year lease is the substitute for the foreign interest in owning a piece of the market without allowing full ownership of the land.   Investment Potential Firms dealing with properties that are under 99-year leases commonly see the values soar because there is a lot of demand for property in Abu Dhabi. This makes them attractive in the endeavour of finding long term returns for investors.   Renewable Terms Most leases being renewable after their expiration mean that the property can be used in the next generations as it is. It is normally agreed with the landowner based on certain renewal terms. Cons Of 99-Year Leases In fact, the more appealing long term lease model also has its concerns and some disadvantages have been perceived out of it.   No Land Ownership The tendency of property buying under a 99-year leasehold is that the buyer cannot own the land. This restriction could also negatively affect the value proposition of the property as against other freehold solutions.   Uncertainty Upon Expiry Leases may be given for renewable but, it is not automatically certain that the landowner will be willing to accept his renewal terms.   Potential for Reversion In case of failure to renew or extend the lease the owners loses ownership of the property and transfers to the landowner.   Limited Loan Availability Certain institutions of finance may be rather reluctant in funding property in situations where freehold tenure is not apparent, but limited to a ninety-nine year hold leash.   Depreciation Towards Expiry During the last years of the lease the value of the property can be low because of the risk associated with renewals. When The Lease Expires? Critics of the use 99 year lease holds include, one of them being what will happen after the expiration of the agreement period. Here’s an overview of the potential scenarios:   Renewal of the Lease Fortunately, in most cases property lessees have the chance to extend the lease. Renewal terms are agreed with the landowner and renewal can come with extra lease costs or new rules and regulations to follow.   Reversion of Ownership When this lease is not renewed, then the property reverts back to the owner of the land. It often emerges when the owner does not meet the renewal conditions or when the landowner does not want to renew the tender.   Compensation In some occasions property owners may be reimbursed the value of property in event of non renewal of the lease.   Legal Protections In Abu Dhabi’s real estate laws there are provisions to safeguard owners’ interest of freehold properties under 99 years lease holding. Helpful Advice To Buyers If you are considering purchasing a property under a 99-year lease in Abu Dhabi, here are some practical tips to ensure a smooth experience:   Learn about Lease Contract Study the renewal clause, the right to change essential conditions, also, look through the possible expenses. If considering incurring debt is complicated, consult with a lawyer.   Assess Long-Term Plans Think seriously if the 99-year lease corresponds to your plans for the future this is for instance inheritance, expansion of business and others.   Verify Renewal Policies Check the existing renewal policies before purchasing a property from the landowner or the developer. You should understand these terms to enable you to plan for the future. Should You Be Concerned? For the majority of consumers, a 99-year lease in Abu Dhabi should not be problematic. The term is long enough to make use of it for personal or great for commercial purposes, and having the option to renew adds to the bonus. Final Thoughts Abu Dhabi’s system of having a 99-year lease is a

Buying a property is probably one of the most significant events of any individual’s life and, for many, the final long-term investment that comes along with a ‘dream come true.’ However, as far as the process of purchasing a property goes, especially in a place such as Abu Dhabi, there are some several fees included in the whole procedure that cannot be overlooked. These fees include, for instance, the registration fee, specific land use, and infrastructure usage fee. This shall be part of your investment, and it changes the amount sometimes. Knowing all these fees will hence prevent those shocks on the last amount. Some of the main fees in the process of acquiring a property in Abu Dhabi include: Sale and Purchase Fee Among the major fees that would arise for a buyer who might consider purchasing Abu Dhabi property, there is the registration fee commonly known as the sale and purchase fee. The executive committee has broadly agreed on a general resolution number 49 that puts the supposed make up of the registration fee in a range between 1-4% of the actual property value and at present is 2%. For charge, this in a standard case that tends to take place among selling and buying at Abu Dhabi must be apportioned taking in mind the circumstances of mutual consensus. Here 2. Musataha and Usufruct Fees: Usufruct or Musataha, is a right exercised and developing such land during their tenure for which they are given. Those properties which have an owner and whose owner registered have a rate as high as 4% total value for exercising or developing land, usufruct, or musataha. No cap is made on this and is calculated by taking 4% of the annual Musataha or usufruct consideration, based on current market values multiplied by the number of years within the agreement. It is to be paid at registration to the respective municipality upfront. White Land Tax It would charge the white land tax on the uncommitted commercial and investment lands owned by Abu Dhabi. These are between 1% and 4% of the total value of the land. They are those which would directly benefit from the infrastructural services. It has yet to be levied but would probably cause further developments on the land, reducing added demands for residential and commercial spaces. Infrastructure Charge This charge is paid by the buyer upon buying commercial or investment land. In the Emirate of Abu Dhabi, the charge is considered an ad-valorem, a single charge per square footage of land acquired and payable for basic services such as roads, utilities and public infrastructure, among others. Infrastructure fee: this depends on locality in Abu Dhabi, it is AED 100 per square meter in central city, and AED 90 in Al Ain, Al Dhafra ranges AED 80. Also, this amount has to be taken into the budget as it’s going to hugely influence the figures at the sale price. Disposal Fee of Handed Over Land Fee If it has already been sold, donated, or auctioned to other people, then it will have borne the burden of 15% that the local municipality shouldered unto that lot if it’s not yet occupied. It is made effective by virtue of Resolution No. 49. And it doesn’t embrace mortgaging of the property; therefore the charge could be only upon disposal or the changing of its ownership. This fee may also impact the following buyers or lenders in case the house is sold through foreclosure thus there is a need to know its implication. Mortgage fees One is bound to spend some additional money so that one may have a mortgage in Abu Dhabi. The mortgages’ laws of the UAE prescribe that one is required to register his mortgage, where one needs to pay 0.1% very low fee upon the registration of mortgage. This amount was on the complete purchase of property, and therefore, it needs to add on the top cost of a purchasing property. Agent Fees Usually, real estate agents in Abu Dhabi charge a commission. The commission is 2 percent of the total value of the property. In addition, the agent’s commission is charged with 5% value-added tax. This is another cost that is worthy of note, especially for those who hire the services of a real estate agent to facilitate the purchase. Land Area Increase Fees Sometimes, one may need more space after buying a specific residential or commercial property. The expansion of the land space of already existing residential or agricultural land reduces 5 percent of the value of the purchased space from its market value. For commercial or investment land, the charge provided is 75 percent of its market value. The charge is included any time you plan to expand the land space of the acquired property. Other Charges Other charges aside from the ones listed above, one pays when buying land in Abu Dhabi; Transfer fee for mortgage AED 200 Mortgage redemption fee AED 1,000 Commercial land consolidation fee AED 10,000 Investment land consolidation fee AED 5,000 Residential and Agricultural land consolidation fee AED 3,000 Site plan fee AED 200 Will of the property of a deceased AED 3,000 Abu Dhabi Municipality Charge: About 2% of the selling price Mortgage Registration Fee: 0.1% of the selling price Commission for Real Estate Agency: 2% of the sale consideration + 5% VAT Commission for Bank mortgage arrangement: Mostly up to 1% loan amount + 5% VAT Cost for title deed: AED 1,000 Bank’s property valuation charge: AED 2,500 to AED 3,000, + 5% VAT To know the total cost These are the charges you will be including in your budget when you are buying the property in Abu Dhabi, and you will financially be prepared for this. The fees might seem a little too much, but it will give you time to understand each one, and hence, you will be able to budget accordingly, not incurring any unexpected costs when buying the property. Conclusion This knowledge about the costs that