Property Investment in UAE: Foreigner’s Guide (2025)

In the United Arab Emirates (UAE), property ownership is open to both residents and non-residents in designated freehold areas, making it one of the most accessible markets in the region for foreign investors. The UAE offers a streamlined buying process, no personal income taxes, and a wide range of property types across its major emirates.

Whether you're seeking a rental investment, a second home, or a foothold in a fast-growing market, this 2025 guide covers everything you need to know about buying property in the UAE as a foreign buyer.

12 Things to Know Before Buying a Property in the UAE

1. Can Foreigners Buy Property in the United Arab Emirates
2. Best Cities and Regions to Invest
3. Square Meter / Square Foot Prices
4. Median Asking Prices
5. Rental Yields and Rents
6. Market Performance (Past and Present)
7. Landlord and Tenant Laws
8. Property Related Taxes
9. Buying (and Selling) Costs
10. Short-Term Rental Regulations
11. Mortgage and Financing Options
12. How to buy property in the UAE: step-by-step

1. Can Foreigners Buy Property in the UAE?

 Yes, foreign nationals can buy property in the UAE — but only in designated freehold areas.

The UAE allows both residents and non-residents to purchase property in these zones, with full ownership rights. Rules may vary slightly between emirates, but Dubai and Abu Dhabi both offer a wide range of freehold developments open to international buyers.

2. Best Cities and Regions to Invest

Dubai and the UAE offer compelling real estate opportunities across different budgets and investment goals. Here are some of the top areas to consider:

• Downtown Dubai – Dubai’s most prestigious district, home to the Burj Khalifa and Dubai Mall. It attracts wealthy buyers and short-term rental investors. Prices are high, but so is global demand and capital appreciation potential.
• Dubai Marina – A vibrant waterfront area popular with expats and tourists. Marina apartments are in constant rental demand, and well-located units can generate strong short-term rental yields.
• Jumeirah Village Circle (JVC) – One of the highest-yielding areas in Dubai, thanks to its affordability and demand from young families. Ideal for mid-budget investors focused on cash flow.
• Palm Jumeirah – Dubai’s iconic man-made island, known for its luxury villas and branded residences. Yields are moderate, but capital values are strong, and properties are highly liquid.
• Abu Dhabi’s Al Reem Island – A modern residential hub popular with professionals. Offers sea views, stable demand, and a more relaxed pace than Dubai, with solid mid-range yields.
• Ras Al Khaimah’s Al Hamra Village – A coastal community offering affordability and high yields. With tourism projects like the Wynn resort underway, it’s increasingly on investors' radars.
• Sharjah’s Aljada – A master-planned development near the Dubai border. Lower prices and growing infrastructure make it attractive for first-time buyers and long-term investors.

3. Square Meter / Foot Prices

Square meter prices in the United Arab Emirates show significant variation. Dubai remains the priciest, commanding nearly $5,000 per sqm as of mid-2025, driven by its global status, prime location, and high-end offerings.

Still, more affordable options exist in less central emirates. While Dubai averages $4,932 per sqm, buyers can access better value in places like Abu Dhabi, where prices are considerably lower for comparable mid-market units.

As of June 2025, average square meter asking prices for newly built residential properties are approximately:

• Dubai – $4,932
• Abu Dhabi - $3,594

Here's how it looks when compared to other Middle Eastern cities.

4. Average Asking Prices

Average asking prices for one-bedroom properties vary widely across key cities in the UAE as of mid-2025:

• Dubai – $354,000
• Abu Dhabi – $368,000
• Sharjah – $212,000
• Ajman – $157,000

Average asking prices for two-bedroom properties are higher:

• Dubai – $594,000
• Abu Dhabi – $599,000
• Sharjah – $327,000
• Ajman – $212,000

5. Rental Yields and Rents

Rental yields in the United Arab Emirates are considered moderate and are lower than several other areas in the region. Dubai has the strongest gross rental yields for apartments, typically ranging from 5% to 8%, with smaller units offering the best returns.

Abu Dhabi tends to offer slightly lower average yields. Other emerging markets like Sharjah and Ajman present attractive opportunities for investors seeking more affordable entry points and solid rental income.

Combined with a tax-free environment for individuals, high expatriate demand, and landlord-friendly regulations, the UAE rental market remains an appealing choice for income-focused property investors.

Below are the current rent prices in the UAE for 1-bedroom properties:

• Dubai - $2,040/month
• Abu Dhabi - $1,880/month
• Ras Al Khaimah - $1,130/month
• Sharjah - $880/month
• Ajman - $630/month

6. Real Estate Market Performance (Past and Current)

The UAE’s housing market has seen significant ups and downs over the past decade. After a prolonged slump from 2015 to 2020, prices began to recover modestly. But it was the post-pandemic rebound that truly reignited the market, especially in Dubai. In 2021 and 2022, home prices surged as foreign investment returned, demand from expats rose, and new visa reforms boosted buyer confidence.

Dubai, in particular, experienced strong momentum, with premium areas seeing double-digit gains. Meanwhile, markets like Abu Dhabi and Sharjah showed more modest but steady growth. Despite global economic uncertainties, the UAE’s housing market remained resilient through 2023, then skyrocketed by as much as 36% in 2024, buoyed by limited supply, investor demand, and the country’s business-friendly climate.

Here’s a year-by-year look at how the UAE property market has performed:

Data Source: Reidin.

7. Landlord and Tenant Laws

The UAE’s landlord‑tenant laws are considered pro‑tenant by the Global Property Guide. While landlords retain rights, including timely rent collection, property inspection with notice, and eviction for valid reasons. The system tilts in favor of secure, fair tenancy for residents.

Tenants enjoy key protections like security of tenure, regulated rent increases (e.g., via Dubai’s RERA rent calculator), and landlord responsibility for major maintenance. Lease agreements must be registered (e.g., via Ejari in Dubai), and tenants benefit from transparent, enforceable contracts.

8. Property Related Taxes

The United Arab Emirates stands out for its tax-friendly environment, one of the major benefits for property investors. There is no personal income tax in the UAE, which means rental income from investment properties is not taxed even for non-residents at the individual level. Similarly, there are no capital gains taxes on the sale of property, making it especially appealing for resale investors.

However, investors should be aware of other costs and taxes in the UAE:

• A 5% Value Added Tax (VAT) applies to certain commercial property transactions and services, though most residential property sales and leases are VAT-exempt.
• Property purchases typically incur a one-time transfer fee of around 4% in Dubai (split between buyer and seller unless negotiated otherwise), along with registration and administration fees.
• For corporate investors or entities with significant property holdings, profits may be subject to the UAE’s new corporate tax regime, introduced in 2023.
• While rental income from real estate held by individuals is exempt, income from property held by a company may be taxable at the standard corporate rate of up to 9%, depending on the structure and nature of the business.

Overall, the UAE remains a low-tax jurisdiction with relatively few ongoing obligations for property owners, especially those investing as individuals.

9. Buying (and Selling) Costs

Buying and selling costs in the UAE are generally in the low-to-moderate range compared to many Western markets.

• Buyers typically pay around 9%-10% extra on top of the purchase price. This includes the 4% property transfer fee, 2% agent commission, and approximately 1% legal fees, plus a few smaller administrative or registration charges.
• Sellers generally incur 2%-3% in fees, primarily agent commissions

All told, the combined round-trip transaction cost for buying and then selling stands at approximately 9%-10% of the property price, weighted more heavily toward buyer-side expenses.

Here's a full breakdown:

10. Short-Term Rental Regulations

Short-term rentals – often referred to as “holiday homes” in the UAE –  are legal and actively supported in cities like Dubai and Abu Dhabi, but hosts must comply with strict licensing and reporting requirements.

In Dubai, individuals can rent out up to eight properties under one license from the Department of Economy and Tourism (DET). Only entire units may be listed; room rentals or shared spaces are not allowed. Each property must be registered, display an official permit, and follow specific guest-check-in procedures. A Tourism Dirham Fee (AED 10–15 per night) must be collected from guests, and properties are subject to safety and quality inspections.

Abu Dhabi operates under a similar system through the Department of Culture and Tourism (DCT). Each unit requires its own license, and owners must report occupancy and revenue monthly. A 6% tourism fee is also collected from guests and paid to the DCT.

Renting out a property without a license or exceeding the permitted unit limit can result in fines starting at AED 5,000, plus potential property closure. Commercial investors managing more than eight properties must register as a business and hold a trade license.

While there is no personal income tax on rental earnings in the UAE, corporate entities may be subject to the new 9% corporate tax on income, depending on the ownership structure.

Both Dubai and Abu Dhabi actively enforce compliance through inspections, digital guest logs, and platform monitoring. The UAE’s well-structured system continues to attract global investors and hosts, particularly due to its tax-friendly environment and high demand for short-term stays.

11. Mortgage and Financing Options

If you're planning to finance your property purchase in the UAE, you’ll find a relatively open and competitive mortgage market. Both residents and non-residents can obtain mortgages, but terms are generally more favorable for UAE nationals and expatriate residents than for overseas buyers. Various traditional mortgage options are available as well as Shariah-compliant Islamic mortgages that abstain from charging interest.

Interest rates for mortgages in the UAE fluctuate based on the mortgage type, the lending institution, and the creditworthiness of the borrower. Typically, fixed-rate mortgages carry higher interest rates compared to adjustable-rate mortgages, while Islamic mortgages may entail higher fees compared to conventional ones.

Most banks require a minimum down payment of 20% to 25% for residents, while non-residents may be asked to contribute 30% to 50% upfront. For investment or off-plan properties, down payment requirements may be even higher, depending on the developer and lender.

Mortgage terms typically range from 5 to 25 years, and interest rates may be fixed, variable, or a hybrid of both. In recent years, rates have hovered between 3% and 5%, though actual terms will depend on factors such as loan-to-value (LTV) ratio, income stability, currency of income, and the type of property.

Because criteria and offerings vary widely across banks and financing institutions, many buyers — especially expats and non-residents — choose to work with mortgage brokers or advisors who specialize in the UAE property market. These professionals can help navigate documentation requirements, pre-approval processes, and eligibility assessments across local and international banks.

While the UAE does not offer government-backed mortgage guarantees like some European countries, the country’s stable currency, well-defined regulatory framework, and investor-friendly environment continue to support a robust real estate finance market.

12. How to Buy Property in the UAE: Step-by-Step

1. Research and Find Property: Start by exploring areas that match your goals, whether for rental income, lifestyle, or capital appreciation. Dubai and Abu Dhabi dominate the market, but smaller emirates like Sharjah and Ajman also offer growing opportunities. Use real estate platforms such as Bayut, Property Finder, or Dubizzle, and consider working with a registered real estate agent licensed by the local land department.
2. Research Pricing, Yields, and Legal Restrictions: Prices and yields vary widely by location and unit size. For example, Dubai typically offers high gross rental yields, especially for smaller apartments. Foreigners can freely buy property in designated “freehold” zones, but in non-freehold areas are restricted. Be sure the property is in a freehold zone if you're not a UAE national.
3. Research Long-Term Market Trends: Look at how UAE property prices have performed historically, including key drivers like visa reforms, foreign investment laws, and market cycles (e.g., the 2020–2022 rebound). Also, review mortgage rate trends and shifts in demand by location.
4. Research Fees, Taxes, and Landlord Rules: While the UAE has no personal income or capital gains taxes, buyers must budget for upfront fees like transfer charges (around 4%), agent commissions (around 2%), and registration costs. If you intend to rent out your property short-term, confirm licensing requirements and guest tax obligations in your emirate.
5. Get Legal Advice: It’s advisable to hire a local legal advisor, especially if you're buying off-plan or through a developer. Legal professionals can assist with reviewing sale agreements, payment schedules, title documentation, and registration processes.
6. Make an Offer and Conduct Due Diligence: Once you've selected a property, you'll typically sign a Memorandum of Understanding (MoU) and submit a 10% deposit. The MoU outlines terms and timelines, and both parties agree on due diligence and financing contingencies. Ensure all developer approvals (if applicable) are in place before signing.
7. Sign the Sale Contract: The parties meet at the developer’s office or the relevant land department to complete formalities. The buyer transfers funds (minus deposit) and pays the required fees. The property is then registered in the buyer’s name.
8. Registration and Ownership Transfer: Once the purchase is completed, the land department issues a Title Deed in the buyer’s name. For properties in Dubai, this is done through the Dubai Land Department (DLD). For Abu Dhabi and other emirates, similar processes apply via their local authorities.

Timeline: The typical transaction takes 4 to 8 weeks, though off-plan or developer sales may take longer depending on approvals and payment schedules. 

Need Help?

Buying property in a foreign country can feel overwhelming, but we're here to help.

At Global Property Guide, we offer:

• Data-backed insights on property prices, rental yields, and taxes
• Country-specific legal and tax guidance through our partner network
• Pre-screened investment properties, including income-generating Airbnb units
• 1-on-1 consultations with real estate experts focused on international buyers
• Step-by-step buyer support, from due diligence to closing

Whether you're looking for your first investment in the United Arab Emirates or expanding your international portfolio, we can help you make smart, secure decisions.

Contact our team or book a free consultation to get started.