Steps to successfully sell a property in Dubai while abroad and potential obstacles along the way.
Life is a tapestry of unforeseen beauty and peculiar surprises, as one sage once mused. Such marvels can prove challenging for some to navigate, overwhelmed by their sheer magnificence.
Imagine living and working in Dubai as an expatriate for the past decade. During this time, you invested in an apartment in the highly sought-after Dubai Marina. However, due to personal circumstances, you now find yourself needing a certain amount of money and the only viable solution is to sell the property in Dubai. The situation becomes even more challenging because you lack the time and opportunity to travel back to Dubai for the sale and purchase transaction.
Indeed, this scenario is not a work of fiction but a reality that countless individuals have encountered in the past and will inevitably encounter in the future. So, what should one do in such circumstances?
No need to fret. That’s where a Power of Attorney (POA) comes in handy – a practical and valuable legal instrument.
A Power of Attorney (POA) is a legal instrument that allows you to authorize someone else, known as an “agent,” to represent or act on your behalf for personal and business matters. It is crucial to note that, according to UAE laws, only a specific POA, not a general one, can be granted for property sales. Additionally, it is valid for a maximum period of two years.
If you sign your Power of Attorney (POA) outside of the UAE, it is necessary to properly legalize it. Feel free to visit our blog for a comprehensive guide on the steps to follow when legalizing a Power of Attorney from abroad for use in the UAE.
Until recently, it was possible to authorize your real estate agent or broker with a Power of Attorney to sell your Dubai property while you were away. However, the introduction of new regulations by the Dubai Lands Department (“DLD”) has prohibited this practice. As a result, individuals such as real estate agents, brokers, or any other employees of a real estate company can no longer be designated as legal representatives under a Power of Attorney.
If you have a friend or family member in Dubai, they can act as your agent and handle the sale of your property through a special Power of Attorney for property sale. If you don’t have any connections in Dubai, it’s worth considering engaging a professional Power of Attorney firm to assist you in this process.
The Dubai Land Department (DLD) has implemented a notable change regarding the handling of sale proceeds by agents. Going forward, agents will not be permitted to receive sale proceeds on behalf of property owners unless prior approval from the DLD has been obtained. This means that even if a Power of Attorney (POA) grants the agent the authority to receive sale funds, the transfer of property title will be blocked until the buyer issues a manager’s cheque in the seller’s name. Importantly, the manager’s cheque can only be issued in the local currency, Dirhams.
Although the new rules undeniably enhance seller protection in property transactions, it is worth noting that they also introduce new challenges. Among these challenges is the matter of redeeming the manager’s cheque.
There are a few possible solutions to address this dilemma. The first option is for the seller to request that the buyer make the manager’s cheque payable to the DLD. In return, the government authority will transfer the sale funds to the seller. It’s important to note that prior approval from the DLD is required before proceeding with this option. Additionally, it’s worth mentioning that the DLD charges fees for its services.By exploring these options, you can navigate this situation more effectively and make an informed decision.Another alternative is to consider depositing and clearing the Dirham manager’s account in your home country. Some overseas banks offer a multi-currency account facility, which includes UAE Dirham accounts. It is advisable to check with your current bank of choice well in advance to see if this option is available.
Disclaimer: The information provided on this page is intended for general informational purposes only and should not be construed as legal advice. It is not meant to serve as a basis for any specific action or decision. The content on this page does not create a lawyer-client relationship or constitute the rendering of legal advice for any particular matter. Users of this website are strongly encouraged to consult with their own legal counsel to obtain specific legal advice on any particular legal issues they may be facing.