Ask the law: Should developer register the off-plan property in the name of the purchaser?
Buyer has the right to cancel purchase agreement if the property is not registered
Question: A year ago, I purchased a property from a developer and paid 40 per cent of the property price. But it turned out the developer did not register the property with the Real Estate Regulatory Department in my name. I asked the developer to register the property in my name, but the developer said, according to his agreement with the Real Estate Regulatory Department, the property will be registered in the name of all buyers after the completion of the project. Is this correct? Do I have the right, according to Dubai real estate law, to cancel the purchase agreement because the property has not been registered in my name. Can I recover the money I paid to the developer?
Answer: As per the law, the developer must register the off-plan property in the name of the purchaser in the initial property register once it is sold. This initial registration is a must as per Article (3) of Law no. (13) of 2008 Regulating Initial Property Registration in Dubai. It states that all actions on off-plan property units shall be registered in the initial property register. Sale and all other legal actions that transfer or restrict ownership and any right based thereon shall be deemed null and void unless registered.
After completing the project, the initial registration is turned into final registration provided that the buyer had fulfilled the obligation of price payment as per Article 8 of the same law. The developer shall register completed projects upon receiving the completion certificate from the competent authorities, including the sold units in the name of the buyers who have fulfilled their contractual obligations.
The buyer has the right to cancel the purchase agreement and request the developer to return the money, in the absence of initial registration because the developer had breached the obligations imposed on him by Article 3 of same law on bilateral contracts. If one of the parties does not perform contractual obligations, the other party may, after serving a formal notification to the debtor, demand the performance of the contract or its rescission, as per Article 272 of the UAE Civil Transactions Law.
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