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Due to its diverse selection and progressive outlook, the Dubai real estate market is unique, offering a wide range of options for both homebuyers and investors. Despite the regular discussion of freehold and leasehold agreements, commonhold homes are a separate type of property holding that is gaining popularity in the city. People who want to invest in real estate in a more flexible and community-focused manner are increasingly choosing this ownership option.

This piece will thoroughly explain the concept of commonhold property, detailing its operational mechanics, the legal structure that governs it, and the reasons it may appeal to those purchasing property in Dubai. We will also examine its distinctions from other property ownership models, as well as the advantages and potential difficulties it involves.

Commonhold ownership describes a property structure where each owner possesses direct ownership of their individual dwelling, like an apartment or a standalone villa. Simultaneously, they share ownership of the development’s communal spaces and amenities. This includes areas such as corridors, lifts, vehicle parking, and leisure facilities. This model is prevalent globally and was adopted in Dubai’s property sector to establish a more organized method for overseeing shared properties, especially within residential complexes and secure communities.

Within a commonhold framework, a building or site is segmented into distinct units, each capable of independent sale or mortgaging. The shared spaces, conversely, are collectively managed and maintained by all property owners. The ownership of these communal areas is held by a homeowners’ association, which comprises every unit owner. This association is tasked with the care, upkeep, and administration of the shared resources.

The “Shared Property Act,” also known as Decree Number 27 of 2007, governs communal property ownership in Dubai, particularly in shared buildings. The purpose of this law was to establish joint ownership for properties with several units. It established the foundation for legal clarity in commonhold agreements by outlining the responsibilities and rights of individual unit owners as well as the community’s governing body.

This legislation obligates property builders to officially record the property with the Dubai Real Estate Authority (DLD) and establish a collaborative ownership plan. This plan involves setting up a resident’s management group to oversee the property. The act further requires the formation of a fund derived from resident’s fees, designed to finance the upkeep and administration of communal spaces.

The Shared Property Act seeks to guarantee that the rights of individual property holders are safeguarded, while also delivering an equitable and open system for handling shared spaces. Additionally, it grants the resident’s management group the authority to uphold rules, settle disagreements, and make determinations on behalf of all the property owners collectively.

A commonhold arrangement partitions property rights, granting each owner complete ownership of their personal unit and a combined ownership stake in the shared areas.

Here’s a more detailed explanation of the process:

In a commonhold development, the freehold entitlement for each distinct residential space rests with its respective owner. Consequently, they enjoy absolute control over their unit—be it an apartment, villa, or townhouse—and may proceed with sales, leases, or mortgages as they deem appropriate, mirroring the freedoms of conventional freehold ownership.

Although each homeowner possesses full authority over their personal residence, they are also co-owners and jointly accountable for the development’s communal spaces. These shared areas often encompass places such as entrance halls, hallways, staircases, parking facilities, landscaped grounds, pools, exercise rooms, and various other conveniences.

A homeowners’ association, formed by all property owners within the development, handles the administration of these community spaces. Each resident contributes to decisions about the maintenance and management of shared areas, with influence generally determined by the size or value of their respective property...Read More