The basis is Dubai Law No. 8 of 2007 on escrow accounts in real estate development, in force since 28 June 2007 (source: Dubai Land Department). Every developer selling off-plan must run a project escrow account with a RERA-approved account trustee. All buyer payments go there, not into the developer’s company account.
Funds are released only against construction progress and only for project costs such as contractors, consultants and marketing, so a developer cannot divert buyers’ money to other ventures. Article 14 of the law also requires 5 percent of the amount paid to stay in the account for one year after completion as a defect guarantee (source: Dubai Land Department).
For an off-plan buyer the escrow account is the central protection against developer insolvency and a stalled project. Before the first payment, confirm the project’s escrow account number and its approved trustee.
See how we vet developer and project before you buy on our Dubai developer due diligence page.
