How Can a Real Estate Investment Deposit Be Refunded in UAE?

People often see UAE as a lucrative opportunity for real estate investments. However, it is important for investors and property buyers to know the legal clauses behind every aspect of investing in UAE real estate. And, reputed lawyers in Dubai are trained to help you with it!

Among all the transactions involved in real estate investment, the monetary clauses are quite complicated yet important to understand. While buying a property in the UAE, one has to pay a deposit, which acts as a confirmation of the deal. 

This article is focused on explaining to you the importance of a real estate investment deposit and how it can be refunded if you decide to cancel it. 

Importance of Deposits Made in a Real Estate Investment

Real estate investment deposits are meant to reserve an apartment, commercial space, home, or villa in the UAE, for buying or renting. You pay the deposit to the developer in exchange for a valid receipt of the amount, alongside confirmation of your property booking. 

Well, there is often no formal contract for this exchange of money, but you can still take the help of real estate legal services in UAE to ensure a witness-backed transaction and legal counselling. 

Remember, a deposit and advance isn’t the same thing! Most people learning about the real estate laws in the UAE use these terms interchangeably, which is a wrong understanding. 

A deposit is nothing but a down payment to guarantee that a buyer is committed to buying the property. On the other hand, an advance or security deposit is a prepaid & refundable amount that guarantees a tenant will be returning the property as received and with all the bills paid. 

When to Seek a Refund of Real Estate Investment Deposit in UAE?

Now, if you want to revoke your commitment and are seeking a property deposit refund in UAE, it might mostly be due to one of these reasons:

• Project Cancellation: If, for some reason, the project gets cancelled entirely from the developer’s end, or by RERA for construction irregularities, you will be liable for getting the complete refund of your invested amount. 

• Persistent Delivery Delays: If the developer continues to extend the handover or delivery date without any valid reason, you can seek a refund of real estate deposit in UAE. 

• Failure to Meet Terms of Sales Agreement: There might be certain contract obligations associated with your real estate investment in the sales agreement, which the developer must adhere to. Failing that, you can take the help of law consultants in Dubai to get a refund of your investment amount. 

If the construction of a project is cancelled for a reason beyond the developer’s control and when no negligence has been made, the refunds will be processed with a maximum deduction of 30%. 

Seek Legal Help for Claiming a Refund of Your Real Estate Investment Deposit!

If you seek a property investment refund in UAE for any of the above reasons, seeking legal assistance can be the right method of approach. So, look out for the best real estate lawyer in Dubai to not just help you with legal advice, but also assist you with the steps involved in claiming your refund. 

Remember, there is no dedicated procedure for claiming a real estate deposit refund, as it totally depends on your type of contract, associated terms & conditions and legal rights. Here are the detailed steps that a proficient lawyer will adopt to help you with your real estate deposit recovery in UAE:

1. Your lawyer will help you gather all the essential documents associated with your property investment, such as payment proofs, SPA, emails, letters, bank statements, cheques, etc. 
2. If you are seeking a refund post-cancellation of your property construction, then the RERA cancellation notice will also be taken into account. 
3. As part of the legal procedure for a deposit refund in UAE, your lawyer will file the claim. For cases in Dubai, the claim will be filed with the Special Tribunal for Liquidation through the Dubai Courts, whereas for other Emirates, it will be filed via local courts.
4. The case will then be reviewed by the authorities by taking into account the said reasons, such as cancellation, contract violation, handover delays, or others. 
5. Your lawyer will protect your rights and will present a strong case with a high chance of winning. 
6. A final decision will then be made by the governing authorities, and an enforceable order will be released for developers to make the property booking amount refund in UAE. 

Parting Words

Getting your real estate investment deposit refund in UAE can be tricky at times, considering the type of developer and contract obligations you are dealing with. Therefore, it is always better to get legal advice from proficient real estate lawyers when property developers violate rules, and you seek a refund of your investment. 

RH and HALE is one of the best law firms in UAE, Dubai, and all other Emirates in the UAE, with a team of profound advocates, masters in their respective domains. We will be assisting you with every legal hassle associated with your real estate investment. To know more, feel free to reach out to us!