What is the difference between "freehold" and "leasehold" property in the UAE?
What is "freehold" versus "leasehold" property when buying property in the UAE?
Which of the two modes is more suitable for a foreign investor looking for property abroad, in terms of control, duration and yield?
What does "freehold" and "leasehold" mean in the United Arab Emirates
The freehold ownership implies that the buyer obtains full ownership of the property and of the land on which it is built, with the right to sell, lease, modify the property and transmit it to heirs.
The leasehold, on the other hand, is based on a right to use the property and/or land for a set period (typically up to 30-99 years in the UAE) without acquiring full ownership of the land, and with greater dependence on the leaseholder/landlord or developer.
For a foreign investor considering a foreign purchase, the difference between these two models needs to be carefully evaluated, as it affects freedom of management, inheritance, control, and development potential.
What are the advantages and limitations of each mode
With the freehold, the main advantages are: full control over the property, possibility of transmission to heirs, often better perception of a stable "heritage asset." However, it involves higher entry costs and more responsibility (maintenance, management, registration).
With leasehold, the advantages are typically a lower purchase price, less direct responsibility for some aspects of the property, and perhaps easier terms of entry. The limits, on the other hand, include limited right to land, defined duration of use, potentially restrictions on structural changes, subletting, or resale.
In an investment perspective, these aspects are crucial: duration of control, freedom of management, future liquidability, and peace of mind of the asset...
To choose between freehold and leasehold as a foreign investor in the UAE, consider these points:
Time horizon: if you think about the property for many years (5-10 and beyond) or even want to pass it on, freehold tends to be more consistent.
Exit strategy and liquidability: freehold, having full title, can be more easily liquidated; leasehold with limited right and finite duration can be more complicated.
Budget and costs: if you have a smaller budget and want quicker entry or less complex management, leasehold can be a gateway, but with awareness of the limitations.
Management and responsibility: if you are willing to handle maintenance, management, possible risks, then freehold; if you want to delegate and have fewer direct burdens, leasehold may be an option.
Regulatory context and location: check that the property is in a foreigner-free zone, that the property is properly registered, that there are no hidden constraints. This is where local assistance comes in.
Why choose REMA Living Real Estate to guide you in choosing freehold vs leasehold
We at REMA Living Real Estate put not only a selection of properties in the UAE at the service of your project, but strategic accompaniment: we analyze together the property model (freehold vs leasehold) best suited to your profile, family, time and financial needs. We check zoning, registration, rights, costs and potential risks. Our approach is ethical, transparent, and geared toward your and your family's peace of mind: it's not just about the "best return," it's about an investment that makes sense in your life.
A practical tip: Clearly assess goals, timeframe and impact
A common sense tip: Before you sign or commit, stop to think about three key questions: "How long do I intend to hold this property?", "How much control do I want to have over the property?", "What is my exit strategy?" Answer truthfully and align your choice (freehold or leasehold) with these answers. And finally, make sure you have a financial buffer for any unforeseen contingencies (maintenance, exchange rate, new regulation) and don't leave the decision solely to the purchase price or the promise of return. That way you build an investment that not only works, but that you really need.
