Are you considering investing and wondering how to start a real estate business in Dubai? Here is your ultimate and inclusive guide.
The real estate market in Dubai is full of opportunities, which attracts many investors. If you’re thinking of having your own real estate business in Dubai, then visibility and awareness are a must for a robust and solid plan.
That’s why we’re bringing you this inclusive and detailed guide from experts in the field about how to start your real estate business in Dubai. It will help you in each step so you won’t feel overwhelmed or lost.
- Eligibility Conditions to Start Real Estate Business in Dubai
- Organizations Responsible for Licesning Real Estate Companies
- Legal Requirements to Register for Real Estate Company in Dubai
- Licences Required for Setting Up a Real Estate Company
- How Can You Start Your Real Estate Business in Dubai?
- DLD Requirements for Each Type of Business
- Estimated Budget for Starting a Real Estate Company in Dubai
- How Can You Set up a Real Estate Company in Dubai
- Options for the Office Location
- Is the Free Zones a Better Option?
- Legal Considerations for Setting Up an Office Space
- Benefits of Starting a Real Estate Business in Dubai
1. What Are the Eligibility Conditions to Start Your Real Estate Business in Dubai?
The eligibility conditions to start your real estate business in Dubai are not strict. Find more below about them.
- Age Requirement: Individuals must be at least 21 years old to apply for a permit to conduct real estate business in Dubai.
- For Those Below 21: If you’re under the age of 21, then consent of a guardian, along with approval from the city’s authorities, are required to become a shareholder in a real estate company.
Ensure you meet these criteria before proceeding with your business aspirations in Dubai’s real estate sector.
2. What Are the Organizations Responsible for Licesning the Companies in the Real Estate Sector in Dubai?
There are different key organizations responsible for licensing companies in the real estate sector in Dubai. They are all governed by the Government of Dubai. Find below the names of those organizations.
- Dubai Department of Economic Development (DED)
- Dubai Real Estate Regulatory Agency (RERA)
For Mainland Companies
- Regulating Authority: The licence is issued by DED with the permission of the Real Estate Regulatory Agency (RERA), which is part of the Dubai Land Department (DLD).
3. What Are the Legal Requirements and Documents That You Should Prepare to Register for Real Estate Company in Dubai?
You should be prepared with a number of documents and aware of the legal requirements needed upon starting your real estate business in Dubai.
Find below the list of requirements.
- Police Clearance Certificate: The owner of the company must provide the relevant certificate from the Dubai Emirate Police (Police Clearance Certificate).
- DED Approval: An Initial Approval from the Dubai Economic Department (DED) is mandatory as step No.1.
- Office: All Businesses in Dubai must have an office
Documents for Initial Approval in DED:
- Passport: for the company’s owner and manager. (It could be the same person or different)
Residency Status Information:
- For newcomers: the passport page with details of the last UAE border crossing.
- For long-term residents: If the owner and/or manager already possesses a UAE residency visa, the below items are required
- Emirates ID
- Visa
- No Objection Certificate (NOC) from the current visa sponsor is needed.
- Company Name: You should be ready to propose several company name options, and names should fulfill DED requirements.
4. What Are the Licences and Permits Required to Set Up a Real Estate Company in Dubai?
The required licences or permits differ depending on the activity of your business in UAE; however, whatever your business activity, you must have a licence in order to operate legally.
The DED has numerous Real Estate activities; some of the most popular are :
- Real Estate Buying & Selling Brokerage
- Leasing Property Brokerage Agent
- Buying and Selling of Real Estate
- Leasing & Management of Self-Owned Property
- Leasing and Management of other people’s property
5. How Can You Start Your Real Estate Business in Dubai Step by Step?
Once you decide to start your own business, you should have a plan to follow; this plan depends on the steps needed, including legal and non-legal ones.
Through the below list, you will find how it goes and what to consider step by step.
Step #1
You (a business person) have to understand which business activity better matches and covers your business goals.
Step #2. Company Registration and Licence Acquisition:
- Obtaining Initial approval and Name Reservation from the Dubai Economic Department (DED).
- Getting a “good conduct” certificate from the police.
- Rent Office space.
- Obtaining External approval from RERA (Dubai Real Estate Regulatory Agency).
Step #3. Sequence of Actions After Obtaining the License:
- Residency Visa Processing:
- For owners – General Directorate of Residency and Foreigners Affairs (GDRFA).
- For employees – Ministry of Human Resources and Emiratisation (formerly Ministry of Labour).
- Broker Card Registration:
- To start a Real Estate business, a broker card registration is required.
- After obtaining the agency registration certificate, all brokers must take an exam.
- Applying for training at the Dubai Land Department is a must, after which you will proceed with the exam.
Note: If the licence recipient does not plan to engage in brokerage personally, they do not need to register for a broker card.
6. What Are the DLD Requirements for Each Type of Business?
The DLD requirements differ according to the type of real estate activity that you choose. Find below the nature of the main types and the requirements needed from the DLD to start operating.
Real Estate Buying and selling Brokerage and Leasing Property Brokerage Agents can operate as:
- Sole Establishment
- Civil Company
- Limited Liability Company (LLC)
Buying and Selling of Real Estate can operate as:
- Limited Liability Company (LLC)
Common Requirements for All Three Activities:
- External approval from RERA (Dubai Real Estate Regulatory Agency) is mandatory
- All brokers are mandated to take an exam for the Broker Card registration.
Leasing & Management of Self-Owned Property & Leasing and Management of Other People’s Property.
Permissible Business Structures:
- Sole Establishment
- Civil Company
- Limited Liability Company (LLC)
Post-Licence Requirements:
- External Approval: From RERA (Dubai Real Estate Regulatory Agency).
- Establish a personal profile on the RERA platform.
Additional Requirements for Leasing and Management of Other People’s
- Property: A security deposit of AED 5 million is necessary.
- Training: RERA proposes that both the licensee and the manager take the Ejari course, regardless of the type of property management.
7. What Is the Estimated Budget for Starting and Operating a Real Estate Company in Dubai?
The estimated budget for starting your real estate business in Dubai is approximately over AED 27,000, which is the cost of the licence voucher. However, there is no exact amount for setting up your business as it’s affected by different factors and differs from one to another.
Find below the division of some of the basic costs:
Licence voucher: around AED 27,000. (This is not the total cost)
The licence voucher is the invoice that DED issues for the incorporation and it includes government licencing fees of DED.
There are many factors that affect the cost amount:
- Location
- Size
- Office rental price
- Company name (more expensive in English)
- Type of business activity
- Adding an additional activity to the licence (provided they’re compatible).
Additional Fees:
- External approval RERA: AED 5,000
- Online courses for brokers: AED 525
- Broker exam: AED 773
Note: Please note that all amounts listed can vary depending on specific conditions and changes in legislation.
8. How Can You Set up a Real Estate Company in Dubai?
To set up a real estate company in Dubai, you have to follow the following steps. Find below the process of establishing and registering a Business:
1. Consider the Important Points During the Preliminary Stage
During the initial stage of how to start your real estate business in Dubai, you should bear in mind the following points:
- Analyze the legislation, requirements, and regulations of controlling authorities related to the chosen business direction.
- Decide on the specific type of activity the company will engage in.
- Given that this is a real estate business, the territory of your business should be the mainland.
2. Obtain Preliminary Permission
To obtain permission, you have to:
- Visit the DED registrar and secure Initial Approval.
- Reserve the business name.
3. Search for Office to Rent
You can start searching for a suitable area for your office as the location is a very important thing. It’s always good to assign your priorities when it comes to settling on the optimum office options like location, prices, and facilities.
Moreover, there is a huge variety of offices for rent in Dubai, so you will surely find an option that matches all your needs.
4. Fulfil RERA Requirements
5. Acquire a Licence from RERA
6. Finalize Post-Licence Requirements
There are some steps you have to do after getting your licence. Have a look below:
- Residency: Register for immigration and obtain residency for the business owner.
- Hiring: Register with the Ministry of Labour and process necessary documentation for employees.
- Broker Cards: Secure broker cards from RERA.
- Banking: Prepare the necessary document package and open a bank account considering KYC (Know Your Customer) procedures.
7. Complying with Legislation.
You should:
- Determine whether you are obligated to register with the FTA (Federal Tax Authority UAE) and other government entities.
- Adhere to anti-financial crime laws and anti-money laundering measures.
9. Are There Specific Places Better for the Office Location?
No, there isn’t a specific place better than another, as it all depends on your preference, business, and budget.
However, you’re free to choose a suitable area, if your company is on the mainland, then it must have an office for registration in the Emirate of Dubai.
10. Is the Free Zones a Better Option? And why?
Free zones in Dubai as the location for your office might be a good or bad option according to your case; accordingly, it’s better to know about each option to decide.
Free Zones
- Companies registered in free zones have limited operations within the UAE. They can only operate within that specific zone or outside of the UAE.
- Such companies are not allowed to conduct business in the general mainland market of the UAE.
Mainland UAE Companies
A mainland company has the capability to conduct operations both locally and globally.
Nowadays, local companies also gain the trust of both local and foreign partners, including banking institutions.
11. What Are the Considerations for Setting Up an Office Space That Meets Legal and Operational Requirements?
There are some points that you should consider while setting up the office of your new business. Being aware of them will make the process easier and provide you with some guidance.
Office Space Requirements for Mainland Companies in Dubai
Type of office space:
- The office must be a physical space.
Lease Agreement:
- Must be signed under the name of the Company.
- Lease duration: at least 1 year.
There are two main options for office rental in Dubai :
- Business Center Office: This is a more cost-effective choice as it’s fully furnished and includes all utility-related payments. (but not all activities are allowed to be registered on the base of BC)
- Standalone Office: This option might be more costly, as it requires additional expenditures for setup and incurs extra fees.
12. What Are the Benefits of Starting a Real Estate Business in Dubai?
There are many benefits that come with starting a real estate business in Dubai; it’s not only about having your own business but also what this city has to offer in this regard.
Find below some of the perks that come with starting your business in Dubai.
- Economic Growth: Dubai boasts a rapidly growing economy, sparking interest in the real estate market.
- Diverse Property Options: The market’s variability offers choices between budget and premium segment properties.
- Business Activity: Dubai is a business hub, home to numerous international corporations and solvent clients.
- Record Transaction Volumes: In 2022, real estate transactions doubled, hitting a 12-year record with a total sum of $41.13 billion.
- Foreign Investments: Dubai ranks second worldwide in direct foreign investments, with investments in real estate growing by 100% in recent years.
- Tourism Infrastructure Development: There’s an anticipated 134% increase in built-up area over the next 20 years, with property returns ranging from 7 to 13%.
- Presence of Major Developers: Dozens of globally renowned developers operate in Dubai, backed by the government.
- Tax Benefits: Most taxes, including those on real estate and international activities, are set at zero.
- Stable Infrastructure: Dubai offers reliable infrastructure and world-class amenities.
- Attractive Policies: The city is renowned for its investor-centric policies and provides equal rights to both local residents and foreigners.
- Reputation: Dubai is recognized as a global hub for upscale real estate.
You now have answers to all the details regarding how to start your real estate business in Dubai; it all starts with information gathering, good planning, and, most importantly, visibility over what happens in the market.
You can check the latest insights about the real estate market in Dubai through the Market Watch Q3 2023 report from here.
