Launching a real estate firm in Dubai can be great for business owners. Thanks to its world-class infrastructure, magnificent skylines, trading prospects, tourism, and booming real estate market, Dubai offers the finest locations for attracting international investors.
Moreover, the good news is that these locations make Dubai the most popular place to start your real estate enterprise. So, in this guide, we’ll guide you on how to start real estate business in Dubai, including license requirements, business plan, and more! Continue to read and stick with us till the end!
Documents Required to Set Up a Real Estate License In Dubai, UAE
To establish a real estate firm in Dubai, you need to get licenses and permissions that the Dubai government has implemented for business setup. You must get the following real estate license in Dubai:
1. Trade License
The most important thing you need to start a real estate business in Dubai is a trade license. The Department of Economic Development (DED) of Dubai also allows you to lawfully launch any business in Dubai to conduct your commercial activities within the UAE.
2. Real Estate Brokerage License
For launching a real estate business in Dubai, a license is required that is obtained from the Dubai Land Department (DLD). When you obtain a real estate brokerage license, you can perform real estate activities and real estate transactions related to the UAE.
To start your real estate business, you also need to fulfil these requirements:
RERA Certification
You or your employee must attend a mandatory training course provided by the Dubai Real Estate Institute (DREI) and then pass the pass the Real Estate Regulatory exam to register your real estate brokerage. The Real Estate Regulatory Authority (RERA) oversees Dubai’s real estate market.
Ejari Registration
In the city of Dubai, the Ejari system oversees rental agreements in the real estate industry. Landlords and property owners need to register with Ejari to manage rentals.
Types Of Real Estate Business Setup in Dubai
As a real estate agent, you can carry on the following types of real estate businesses in the thriving real estate market:
- Real Estate Broker
Real estate brokerage in Dubai helps buyers and sellers complete transactions and make money from sales. A license is required to start a real estate brokerage business that you’ll get from the Dubai Land Department (DLD). Residential, commercial and industrial business structure comprise real estate brokerage, allowing for much growth and specialisation in the real estate sector.
- Property Development
Dubai is rightly famous for its ambitious construction projects. This sector includes acquiring land, getting the necessary permits and managing the project development of new properties. To achieve successful property development, you must understand market trends, find good contractors, and have efficient project management skills.
- Property Management
Dubai has several property owners searching for management companies to look after the daily works of their properties. They do maintenance, rent collection, and facilitating tenant-to-tenant interactions. Property managers play an effective role in maintaining higher occupancy rates, tenant satisfaction, and appreciation of property value.
- Real Estate Investment Trust
Firms that invest in income-generating properties and share profits with investors are REITs. They allow people to invest in large-scale real estate projects without owning land. While Dubai promotes land purchases, laws are in place to keep the right amount of transparency and to help shield investors.
A REIT sets itself up by buying lots of properties, managing them well, and keeping itself financially uncluttered according to strict reporting standards.
- Online Marketing and Advertising of Real Estate
Marketing and advertising real estate business setup in Dubai can prove to be lucrative business lines. Dubai requires the landlords to create business development strategies, manage online and offline campaigns, and use social media platforms to attract prospective buyers and tenants.
Moreover, virtual tours, professional photography and targeted advertising are some of the services that differentiate them from the competition.
- Real Estate Consultancy
It can be a valuable service in which you help advise investors, developers, and property owners. Market analysis, investment strategy, and project feasibility studies are the duties of a real estate consultant.
To fill this role, you need to have in-depth knowledge of the real estate sector in Dubai, regulatory environment, and emerging trends in UAE.
- Short-term Rental Management
The rise of platforms in UAE such as Airbnb caused the property management of short-term rentals to become a huge business opportunity. It consists of booking handling, guest communication and property maintenance. Dubai is ideal for property owners to cash in on the booming tourism industry through short-term rental management companies.
How To Start Real Estate Business In Dubai?
The following steps are essential to set up a real estate business in UAE:
1. Deciding Business Location
To start a real estate company, you need to select the right place for your business. This includes the nature of your business, the accessibility of the market, and the special advantages of operating from that location.
There are three main economic entities for real estate companies in Dubai: mainland, free zone, and offshore. All have their own rules, advantages, and disadvantages.
For instance, few locations won’t charge personal income tax, import duties, currency restraints and overbearing regulations.
2. Choosing Business Activity
To start a business, you must choose the business activity you want to do in Dubai. To operate a real estate company, you can engage in the following activities:
- Professional Company
- Sole Proprietorship
- The Limited Liability Company (or LLC)
- Partnership en-Commendam
- Joint Venture
- Private Shareholding
- General Partnership
- Public Shareholding
This must be made clear when applying for your license from the Dubai Land Department to register your business, start a property consultancy agency, or set up other related activities.
3. Choosing a Company Name
The UAE has rules and regulations you cannot afford to ignore when it comes to naming systems. It must not contain foul and cynical epithets, and it must not be the name of other successful real estate businesses.
4. Getting RERA Certification
In order to get your brokerage license from the Dubai Land Department, you must go through the Certified Training for Real Estate Brokers course (DREI) and pass an exam.
After passing, get your Good Conduct Certificate from Dubai Police and check with the Real Estate Regulatory Agency (RERA) for broker ID. The RERA broker ID is required and is only valid for one year.
The following documents are required for RERA Registration:
- Application Form
- DED License Copy
- Tenancy Contract (Ejari)
- A RERA Payment Receipt is issued when a student attends a RERA course.
- Location of Your Business
5. Memorandum of Association
A real estate company in Dubai requires a legal document named Memorandum of Association (MOA) for company incorporation. It describes the company’s aims and the economic operations to be performed by the business.
The MOA shall be written as compatible with the Dubai Economy and Tourism Department, as well as laws of UAE Commercial Law, and it has to be notarized.
6. Applying for a Trade License
Once you are through with the requirements for the initial stages, you should apply for your trade license. Suppose you will be offering services in Free Zones. In that case, several documents must be submitted, and a license for professional services for property management and or brokerage services must be obtained.
Apart from that, for labour contracts and sponsorship of foreign employees, a company has to register with the Department of Naturalisation and Residency Dubai (DNRD) and the Ministry of Labour (MOL).
This process consists of a fitness test, an abnormal blood test, and a chest X-ray test. You can also sponsor visas for their dependents and domestic employees. The following documentation is required:
- List of business and shareholders
- Proof of address
- Identification documents
7. Applying for Approval with the Dubai Land Department
Dubai Land Department (DLD) is responsible for Dubai’s real estate affairs. You must apply to the DLD for your preliminary approval before commencing operations. This includes opening a corporate account for your real estate brokerage firm.
Looking to get approval from the Dubai Land Department to enjoy the ease of doing business? Xpert Advisory will be here to guide you through the whole process. Reach out to us to streamline your company formation and have it running as smoothly as possible!
What Is a Real Estate License Cost In Dubai?
Like any other business in Dubai, starting a real estate business involves certain expenses and procedures. Here’s a breakdown of cost of starting as a real estate broker in Dubai:
Licensing Costs
- Real Estate Brokerage License Formation for an LLC
The cost of procuring a real estate brokerage license for an LLC always ranges from AED 12,900* and above.
- RERA Training and Certification
However, this is great news for those aspiring to conduct real estate business since one has to sit for the RERA training before applying for the brokerage license. This certification costs the Real Estate Regulatory Agency (RERA) AED 5,020* per activity.
- Initial Setup Costs
Registering a real estate company in Dubai is approximately AED 21,000*. Despite this estimate, it does not include all the costs associated with setting up the business and getting initial licenses and certifications.
Additional Costs
The cost of starting a real estate company in Dubai involves some additional charges:
- Legal Fees: The costs of acquiring legal services to formalise the business formation.
- Registration Fees: Expenses incurred in the course of making registration dealings with the respective authorities.
- Office Space Leasing Fees: Expenses such as rent expense for an appropriate office.
- Employing Staff: A qualified staff hiring cost includes the wages and allowances for employees.
- Marketing and Advertising Charges: Cost of your business promoted through different channels.
- Operational Costs: The ongoing expenses, like utilities, office supplies, other overheads and so on.
Final Words
While it looks like a challenge to start real estate business in Dubai, it is worthwhile if you do it the right way and with the right licenses. Getting essential licenses, RERA certification, and finding a suitable location and business activities are important for success. The real estate market in Dubai is growing, so now is a good time to start.
Don’t want to do all the hard work yourself? Get in touch with us at Xpert Advisory and get fast-tracked to success with your business!
FAQs
Is The Real Estate Sector In Dubai Profitable?
Dubai’s real estate market is highly profitable for property owners since the rental yields tend to be higher than other main cities, and the chances of capital appreciation are also quite strong.
Can Foreigners Buy Property In Dubai?
The answer is yes. Foreign nationals — and expats living in Dubai and non resident investors can own property freehold.
Is Real Estate In Dubai Easy?
Dubai is one of the easiest places to buy real estate. There is no capital gains or income tax, which is why this is appealing to many buyers, especially American buyers.
What Makes A Good ROI In Dubai’s Real Estate Sector?
A good ROI in Dubai is based on the property type, location, and market conditions. Generally, a 7% – 10% ROI is acceptable for residential property.