How to Start a Real Estate Business in Dubai

Starting a Real Estate Business in Dubai has its own benefits as Dubai’s real Estate market is experiencing rapid growth. Every passing year people are investing more and more in the Real estate sector because of extreme demand and high ROI.

From luxurious and high-end residential properties to state-of-the-art commercial buildings like Burj Khalifa, Palm Jumeirah etc. Dubai has become a center of business and tourism of the world.

Starting a Real Estate Company

Legal Structure:

There are two options an individual can opt for while starting a Real estate business in Dubai. Either opt for establishing a real estate company in Dubai Free Zone or in Mainland Dubai. People mostly opt for a registration in Dubai Free Zone for real estate businesses.

Then comes the decision to choose to register as a Limited Liability Company (LLC) or a Sole Proprietorship for your Real Estate Brokerage. Few of the most common legal structures in Dubai are the following:

• Sole Proprietership
• General partnership
• Limited Liability Company
• Civil Company
• Public Shareholding Company
• Private Shareholding Company
• Joint Venture

Company Name

After deciding the legal structure of our Real Estate Company, it’s time to get your trade name registered and for that you would have to apply to Department of Economic Development (DED). The name should be straightforward and should be in line with industry standards. Try avoiding offensive language, blasphemous and names similar to already well-established organizations. 

RERA Certification

The Real Estate Regulatory Agency (RERA) certification is necessary for a person working in the real estate sector to provide services. RERA is present to ensure proper standards are met and the individuals are competent enough to work in the Real Estate industry.

Memorandum of Association (MOA):

Create and sign a Memorandum of Association for your Real Estate Business in accordance to the Legal structure you chose. This is done in accordance with UAE Commercial Companies Law, companies must include an object clause in Memorandum of Association. The clause states exactly as why the company is incorporated and states the economic activities it plans to perform as soon as it is allowed doing business.

If the company acts outside of the stated activities mentioned in the object clause, then potential actions can be taken against the company and it can be sued and penalized by the regulatory bodies, state or by any third party. So, keeping inn line with the Object Clause is necessary and important. 

A company’s Memorandum of Association (MOA) is a legal document prepared during incorporation. It defines the company’s relationship, its members, and the general public. The Memorandum of Association must be typed in accordance with the protocols of the Dubai Economy and Tourism Department, formerly the Department of Economic Development (DED), and UAE commercial law. It is also vital to notarize the MOA.

Business Location

Securing an office space is very important. As if you are renting the space, then arrange the tenant agreement (Ejari) with the relevant parties.

Trade License

Trade License application consists of some documents. This license is required to carry out property management and brokerage services in Dubai.

Registering with Government Departments:

Registering your Real Estate Company with Ministry of Labor (MOL) and Department of Naturalization and Residency Dubai (DNRD) is important if the company wants to employ expats and sponsor their visas.

Approval from Dubai Land Department (DLD):

To start your operations as a Real estate Brokerage, you must get your Real Estate company approved form Dubai Land Department (DLD) as this is the regulatory body that oversees all the real estate operations in Dubai. 

Following are the licenses required to start a Real Estate business in Dubai:

Trade License

Trade license is obtained from the Department of Economic Development (DED) and when obtained, you are authorized to start a Real Estate business and can run property management and brokerage services.

Real Estate Brokerage License

Real Estate Brokerage License is to be applied from Dubai Land Department (DLD) and when obtained, you are authorized to start Real Estate activities such as buying, selling, listing properties and renting properties.

Commercial License

Commercial License is granted by Department of Economic Development (DED) if someone wants to buy or sell property or in other words use your services in Real Estate sector in Dubai, then this license is a must.

RERA Certification

For compliance with regulatory standards and to demonstrate professional competency, The Real Estate Regulatory Agency (RERA) certification is necessary for professionals who want to work in the Real estate sector.

To qualify for license, individual should register for the Dubai Real Estate Institute’s Certified Training for Real Estate Brokers course (DREI). Without this certification, an individual can not obtain license. The individual must pass an exam at the end of the course to become a registered real estate broker in Dubai. Also do not forget to obtain a Good Conduct Certificate from Dubai.

After passing the exam, you are obliged to contact RERA for your broker ID. You will become a registered real estate agent in Dubai as soon as RERA assigns you a broker ID. Don’t forget to renew your RERA license as it is valid only for 1 year.

Documents required for RERA Registration:

• Application Form
• DED License Copy
• Tenancy Contract (Ejari)
• Payment Receipt for RERA Courses
• Location of your Business

How much does it cost to start a Real Estate Company in Dubai

As soon as you get your RERA training certificate, you can apply for a Real Estate Brokerage license. RERA charges AED 5,020 per activity, and an LLC license costs around AED 12,950. Starting a Real Estate business in Dubai can require a minimum of AED 21,000 in terms of investment.

Advantages of starting a Real Estate Company in Dubai

Anywhere in the world Real Estate sector is always considered as a safe investment. In Dubai, it is regarded as one of the most highly sought after industry as ROI annually is around 5-6% according to recent surveys. This results in good deals and more commissions for Real Estate brokers and brokerages.

Dubai’s Real Estate is in high demand due to a number of reasons which are briefly explained below:

Thriving Real Estate Market

As being a prime tourist attraction and a business hub, demand for commercial and residential properties in Dubai has skyrocketed in the last decade. This has resulted in the Real Estate sector thriving for the past decade and with new projects in pipeline, it is expected to thrive even more in the coming decade.

Strategic Location

Located between Europe, Asia and Africa, Dubai’s location acts as a bridge between three continents and provides its Real Estate Sector an easy access to a wider and more diverse range of potential customers attracted towards Dubai’s strategic location for investment in different businesses and real estate sector.

World Class Infrastructure

The Dubai government has invested heavily in developing state of the art infrastructure including utilities, communication and transport. This has made Dubai a model city with everything available to the residents with almost no difficulty. The has enabled the real estate sector attracting a large customer base as people are eager to invest in or own properties because of the city being a model city.

Strong Economy

Dubai has a diverse economy expanding to services, tourism and financial sectors. This has enabled more and more development in the construction and real estate sector. With a stable economy and no criminal activity, real estate sector has experienced an increase in interest from the foreign investors.

Ease of Doing Business

Dubai government has gone on lengths to make sure the laws and licensing in the city is more favorable for doing business. This has resulted in attracting more and more people to start businesses locally and internationally. The surge of more people coming to Dubai for business has boosted the Real Estate sector in terms of demand and scalability