BUYING REAL ESTATE IN 7 COUNTRIES IN THE MIDDLE EAST

By Ehsan Bayat

The Middle East is gaining popularity with foreign real estate investors due to the area’s emerging economies and growing real estate markets. However, the regulations concerning these transactions vary by country. See the following for information about the real estate buying process for foreign investors in seven Middle Eastern countries:

1. SAUDI ARABIA

Source: edward musiak / License

Although Saudi Arabia passed legislation in 2000 to allow non-nationals to own real estate for their private residence, there are a number of challenges associated with buying property in the country. Among these concerns are rising home prices, limited financing options, and strict residence requirements. For example, foreign companies and individuals must occupy the property and the Ministry of Interior requires buyers to own the property for five years before selling to prevent speculation. The country also forbids any non-Saudi to own property in the cities of Medina and Mecca.

Source: edward musiak / License

Foreign investors can buy private land to develop real estate with prior approval from the country’s licensing authority. However, the cost of land and construction must be worth at least $8 million.

2. JORDAN

• Non-nationals are only allowed to purchase real estate if the buyer’s home country maintains a reciprocal relationship with Jordan.

• Similar to Saudi Arabia, foreign buyers in Jordan have to wait five years before selling a property, and they must obtain purchase approval from Jordan’s Cabinet.

• Foreign investors are required to use a real estate agent while acquiring property in Jordan, but they do not need to hire a lawyer.

• During the buying and registration process, buyers need to work with a number of other government agencies, including the Ministry of Finance and the Lands and Surveys Department.

• The buyer and the seller share the 10 percent registration fee to transfer the title after closing.

3. OMAN

Source: Andrew Moore / License

• Oman started working on legislation in 2002 to allow expatriates and foreign corporations to own property in Oman for investment and residential use.

• Currently, expatriates who purchase land or villas in Oman can only do so in freehold areas with integrated tourist complexes.

• Among these are communities such as Muscat Hills Golf & Country Club, The Wave at Reehan Gardens, and Saraya Bandar Jissah.

Source: Andrew Moore / License

• Non-nationals who purchase undeveloped land must develop the land within four years.

• Additionally, when a non-national obtains real estate in Oman, the property owner and that person’s immediate family members all gain residency rights.

4. UNITED ARAB EMIRATES

• The UAE, and Dubai in particular, are known for their expansive and luxurious developments, which attract real estate investors from across the globe.

• As in other Middle Eastern countries, the UAE only allows foreign nationals and investors to buy property in freehold developments like The Palm, The Greens, and Emaar Towers.

• Non-UAE citizens may purchase properties in freehold developments prior to their completion.

• In the UAE, buyers often select the model of property they want and provide an initial deposit, which is usually between 10 and 15 percent of the total cost.

• Buyers can also offer a holding deposit to take a home off the market while they gather the necessary documents and financing.

5. QATAR

Source: Jonybraker / Source

• Qatar also allows non-nationals and foreign investors to buy property in the country’s freehold developments, and buyers automatically receive residency rights. In most cases, foreign buyers directly acquire and sell real estate through property developers.

• Buyers usually pay a deposit when they sign a contract and then make payments until the unit is completed.

Source: Jonybraker / Source

• For example, one freehold development in Qatar, called The Pearl, requires buyers to pay 20 percent of the unit price to secure the property.

• Buyers subsequently pay 75 percent of the purchase price in quarterly installments, with the remaining sum due when the unit is finished.

6. IRAN

• Based on Iran’s real estate ownership laws, foreign investors can purchase real estate for residential, commercial, or industrial use.

• Foreign residents who move from a property are also obligated to transfer the property title to a qualified non-national or an Iranian within six months of leaving.

• If a non-resident wants to own property in Iran, they can seek right of ownership through the Council of Ministers.

• Foreign buyers in Iran must also work with the municipality and the Economic Affairs and Finance department to obtain a Tax Clearance Certificate and a certificate of property completion.

7. BAHRAIN

Source: philippe leroyer / License

• Since 2003, Bahrain has permitted foreign investors to purchase residential and commercial property in designated areas.

• Among the acceptable districts are the Ahmed Al-Fateh District and Northern Manama. The artificial island of Durrat Al-Bahrain is also an approved location.

Source: philippe leroyer / License

• To register a property in Bahrain, foreign investors need to provide the sales agreement, identification, and the title deed from the former owner.

• Buyers don’t have to work with a real estate agent, but a lawyer can be a valuable resource during the buying process.

• As the buyer is usually responsible for the registration fees, it can be helpful to register the property within 60 days of completing the sales agreement to receive a 10 percent discount.