Legal Overview on Sharjah Introduces New Real Estate Laws to Promote Growth and Investment

Sharjah Introduces New Real Estate Laws to Promote Growth and Investment

The Emirate of Sharjah has recently introduced a set of revolutionary laws and executive council resolutions that aim to strengthen its real estate sector, enhance judicial efficiency, and ensure sustainable urban development. These laws are a reflection of Sharjah's ambition to position itself as a regional hub for real estate investment, catering to both local and international stakeholders.

Significant achievements include the development of the Rental Disputes Center, the reforms in the rules on real estate development projects, new lease legislation, and integrated comprehensive measures for integrating real estate through digital platforms. Of course, novel reforms in property ownership law allow any nationality to acquire or own any property in Sharjah, opening avenues for investment opportunities worldwide.

Key legislations where Sharjah's real estate industry has been updated:

The new enactments include a broad range of initiatives aimed at increasing transparency, protecting the interests of stakeholders, and encouraging investment. Here are some of the most important laws and resolutions:

i.      Law No. 6 of 2024: Establishment of the Rental Disputes Center (RDC)

ii.    Executive Council Resolution No. 37 of 2024: Regulating Real Estate Development Projects

iii.   Law No. 5 of 2024: Property Leasing Regulations

iv.   Executive Council Resolution No. 32 of 2024: The Committee for Integrated Real Estate Services Platform Project

v.    New Regulations of Ownership of Properties: Law No. 2 of 2022 and into the Future

vi.   Law No. 6 of 2024: Center for Rental Dispute

Law No. 6 of 2024 sets a more comprehensive framework on the Rental Disputes Center, improving the way the body addresses rental conflicts effectively and efficiently. It stipulates that RDC clearly structures, specifies the competencies and procedures in line with tenants' and landlords' expectations of getting disputes solved.

Key features of the RDC

i.      Judicial Organisation

RDC is comprised of first instance, appeal and executing departments. Secondly, judges from the Ministry of Justice are lent to all levels of cases that are brought for trial.

ii.    Office of Litigation Management

 Recently introduced in a bid to promote litigation. Cases are prepared; registered and given notice with relevant documents to both parties exchanged across.

iii.   Executing Department

Deals with execution and provisional execution appeals by enforcing judgment over the matters tried. This legal framework increases transparency and efficiency in the process, making rental disputes more accessible for all parties concerned.

iv.   Executive Council Resolution No. 37 of 2024

Regulation of Real Estate Development Projects. Sharjah's real estate sector has experienced exponential growth over the last few years. To sustain this growth, Executive Council Resolution No. 37 of 2024 imposes tight regulations on real estate development projects to safeguard the interests of investors and ensure sustainability in the sector.

Key Provisions

i.        Registration Requirements

There are stringent requirements for the registration of real estate projects, meaning that only proper entities should be undertaking larger developments.

ii.       Escrow Account Management

All developers are obliged to open escrow accounts, which are a financial security arrangement for the buyers. In this case, the sum placed in an escrow account can be only used for project expenses.

The penalty on infractions signifies that the resolution treats the imposition of penalties as serious, making it imperative to follow laws and regulations in the real estate sector.

The regulation of real estate development projects is aimed at building investor confidence and developing sustainable urban growth in Sharjah.

iii.       Law No. 5 of 2024: Property Leasing Regulations

Law No. 5 of 2024 governs property leasing in Sharjah, providing clarity on the obligations of landlords and tenants, lease contract regulations, and eviction procedures. This law is a vital step toward protecting the rights of both parties and ensuring transparency in rental transactions.

Landlord and Tenant Obligations

i.      For Landlords

They must keep the rented property and not do anything that would disturb the tenants. The tenancy agreements must be signed by the local authority to be effective executive documents.

ii.      For Tenants

They must pay their rent on time and keep the property in good condition. The law also provides for clear conditions for eviction and payment of rent, thus ensuring that disputes are minimized and resolved fairly when they arise.

Executive Council Resolution No. 32 of 2024:

To be in tune with the strategy of Sharjah's digital transformation, Executive Council Resolution No. 32 of 2024 modifies the creation of the Committee for Integrated Real Estate Services Platform Project. It is a committee that falls under the Sharjah Digital Department. This committee creates a unified platform for various services related to real estate.

Platform Objectives

i.      Centralized Services

 Property registration, lease contract certification, and payment processing.

ii.       Improved Coordination

Government departments and real estate stakeholders

iii.     Real Estate Efficiency

Reduced paperwork and processing times related to property transactions

The initiative is going to shape the real estate sector and usher in efficient service delivery and increased operational efficiency.

New Property Ownership Regulations

One of the major changes experienced in Sharjah is the lifting of rules and regulations controlling property ownership. The new Sharjah real estate investment law will allow all nationalities to buy and own property in Sharjah, but this depends on some conditions.

New Rules of Ownership

i.    All Nationalities Can Buy Ownership

Full ownership is enabled to everyone with any nationality, but this is subject to the approval of the Ruler.

ii.    Usufruct Rights

Expatriates can exercise usufruct rights in properties for up to 100 years, meaning one can have long-term possession over the same property.

iii.    100% Foreign Ownership

This is possible on both mainland and free zone properties with options open for extended leasing.

iv.     Inheritance and Transfer

Inheritance of properties is allowed, thus possible transfer to first-degree relatives.

These changes reflect Sharjah's commitment to attracting international investors and promoting long-term economic growth in the real estate sector.

Why These Changes Matter for Investors and Residents

Sharjah's new real estate laws and regulations are a game-changer for both investors and residents. By promoting transparency, protecting stakeholders, and enhancing service delivery, these laws create a more stable and investor-friendly environment.

Key Benefits for Investors

i.      Greater Transparency and Accountability

Regulatory measures on developers and tenancy businesses minimize cases of fraud and malpractices.

ii.      International Investment Opportunities

Liberalized property ownership laws attract foreign investors, hence promoting economic growth.

iii.     Online-Based Integration

A harmonized online platform creates efficiency in real estate transactions; it becomes easier for investors to manage their properties.

Residents Benefit

i.       Stricter Laws on Tenancy

New rental laws protect tenants from malpractices and ensure that their rights are not violated.

ii.       Efficient Dispute Resolution

The RDC provides an easy process for solving rental disputes.

iii.       Access to Real Estate Services

Digital transformation has improved the access and efficiency of essential services.

Economic Impact on Sharjah and Future Directions

These legislative changes are expected to have a far-reaching impact on Sharjah's economy, contributing to its vision of becoming a leading regional hub for real estate investment. The emirate's focus on sustainable development, judicial efficiency, and digital transformation aligns with global trends, positioning it for continued growth.

Sharjah's new laws on property ownership open a wide door to unprecedented opportunities for international investors. This emirate seeks to remove the restrictions placed and provide long-term security for all types of investors to spur innovation and diversify the economy.

Conclusion

The recent legislative measures in Sharjah represent a bold step toward modernizing its real estate sector. The establishment of specialized judicial bodies, the introduction of robust regulatory frameworks, fair leasing practices, and the integration of real estate services through digital platforms are all being created to be investor-friendly yet resident-centric.

The most important novelty, though, has to do with property ownership, which will give international investors the opportunity to take part in Sharjah's real estate space like never before. Once these laws set in, they are bound to make Sharjah an even more attractive real estate destination, a foundation of stability and growth for the future years to come.These changes signal new opportunities and progress for investors and residents in the real estate sector in Sharjah.