International real estate glossary
The essential terms to know before investing, explained simply.
82 terms
Off-plan
Buying a property before or during construction, based on plans and renderings. Payment is made in instalments tied to construction milestones, usually at a price below that of completed units.
Freehold
Full ownership tenure in which the buyer owns both the property and the land permanently, with no time limit. In Dubai, foreigners may buy freehold only in designated areas.
Leasehold
Right to use a property for a fixed period (often 99 years), while the land remains owned by the freeholder. At expiry the property reverts to the landowner unless the lease is renewed.
DLD (Dubai Land Department)
Dubai's government land registry that records property transactions and issues title deeds. It collects, among others, the 4% transfer/registration fee on purchases.
Service charge
Annual community fees, billed per square foot/metre, covering maintenance of common areas, security and amenities. In Dubai the rates are regulated and published by RERA.
NOC (No Objection Certificate)
A No Objection Certificate issued by the developer confirming the seller has no outstanding dues or charges on the property. It is required to transfer ownership in a resale.
Escrow account
A regulated, ring-fenced account into which off-plan buyer payments are deposited. Funds are released to the developer only as construction progresses, protecting the investor.
SPA (Sale and Purchase Agreement)
The legally binding sale and purchase contract between the buyer and the developer or seller. It sets out the price, payment schedule, handover date and each party's obligations.
Post-handover payment plan
A payment plan that lets the buyer pay part of the price after the property is handed over, spread over several years. It eases cash flow by extending payments beyond the key handover.
Golden Visa
A long-term UAE residence visa (up to 10 years, renewable) granted to property investors meeting a set investment threshold (AED 2 million). It covers the holder and their family.
ROI / Rental yield
The ratio of annual rental income to the property's purchase price, expressed as a percentage. Gross yield excludes costs, while net yield deducts them to reflect the real return.
RERA (Real Estate Regulatory Agency)
Dubai's real estate regulator, a branch of the DLD, overseeing developers, agents and tenancy contracts. It publishes the rental index and approved service-charge rates, among other things.
Snagging
A detailed inspection of a newly handed-over property to identify defects and poor workmanship (finishes, plumbing, electrics). The snag list is sent to the developer, who must fix the issues before final acceptance.
Capital gain
The profit made when reselling a property for more than its purchase price. In Dubai this gain is not taxed locally, but may be taxable in the investor's country of tax residence.
Transfer fees
Property-transfer charges levied by the land registry at purchase. In Dubai they amount to 4% of the price paid to the DLD, usually borne by the buyer.
ADGM (Abu Dhabi Global Market)
Abu Dhabi's international financial centre on Al Maryah Island, with its own English-language common-law jurisdiction and independent courts. ADGM provides a distinct regulatory framework for companies, funds and asset-holding vehicles, valued by foreign investors for its legal certainty and favourable tax environment when structuring property holdings.
BML Financing (Bank of Maldives)
Property financing offered by the Bank of Maldives, the country's leading bank, for buying or building residential property and tourism projects. Terms (down payment, tenor, rate) vary with residency status and asset type; non-residents rarely access local credit and often fund their projects from abroad instead.
Cap rate (capitalization rate)
The cap rate divides annual net operating income by the property's market value, excluding financing. It allows quick comparison of profitability across assets and estimation of value from a rent figure. A high cap rate often signals higher return but also greater risk or a less sought-after location.
Capital appreciation
Capital appreciation is the increase in a property's value over time, independent of rental income. It depends on the market, location, infrastructure and supply-and-demand dynamics. Combined with rental yield, it forms an investment's total return, but it remains uncertain and is never guaranteed.
Cash-on-cash return
Cash-on-cash return measures annual net cash flow against the actual cash invested (down payment, fees, works), not the property's full price. Common in leveraged purchases, it isolates the return on equity actually committed. It differs from standard yield because it captures the effect of financing and the buyer's own contribution.
Post-Dated Cheques (PDCs)
In the UAE, annual rent is traditionally paid by one to four post-dated cheques handed over in advance, each cashed on its date. The fewer the cheques, the higher the rent a landlord will usually accept. A bounced cheque was long subject to criminal penalties, so tenants must manage their cash flow carefully.
Condition precedent
A clause in a preliminary contract making the sale conditional on a future event, such as obtaining a loan. If the condition is not met, the sale is cancelled and the buyer recovers their deposit. It is a key safeguard protecting the buyer's commitment before the final deed.
Completion Certificate
An official certificate issued by the relevant authority (e.g. Dubai Municipality or DDA) confirming a building is finished in line with approved plans and applicable codes. It enables final utility connection, handover and title registration. Without it the property cannot be legally occupied or sold as completed.
Preliminary contract vs final deed
The preliminary sale contract binds seller and buyer on price and terms, usually with a deposit. The final deed, signed before a notary, legally transfers ownership and triggers full payment. Two to three months typically separate the two stages, allowing conditions to be cleared.
Defect Liability Period (DLP)
A warranty window during which the developer must fix, at its own cost, defects that appear after handover. In the UAE it is typically one year for general finishes and up to ten years for structural and waterproofing defects (decennial liability). Buyers should report defects in writing before the period expires.
Property Deficit (Déficit foncier)
A mechanism where deductible costs of an unfurnished rental (works, interest, etc.) exceed the rents collected, creating a loss. This loss is offset against overall income up to an annual cap, with the excess carried forward against future rental income. A common tool to cut tax through renovation works.
Security Deposit
A sum paid by the tenant at move-in to cover possible damage or unpaid rent. In Dubai it is usually 5 percent of annual rent for an unfurnished unit (often 10 percent if furnished); in France it is legally capped (one month's rent excluding charges for an unfurnished let). It is returned at lease end after inspection, less any justified repairs.
DEWA
Dubai Electricity and Water Authority, the emirate's public utility for power and water. Any owner or tenant must open a DEWA account to activate services, which requires an Ejari or Title Deed and payment of a security deposit. DEWA connection is a mandatory step before moving in or putting a property up for rent.
DLD transfer fee 4%
The transfer fee charged by the Dubai Land Department on a change of ownership, set at 4% of the property's value. Although the law foresees a theoretical split between buyer and seller, in practice the full amount is most often borne by the buyer. This fee adds to agency commission, trustee fees and the NOC fee in the total acquisition budget.
DPE (Energy Performance Diagnosis)
A mandatory French document rating a dwelling's energy and climate performance from A to G. It must appear in any sale or rental and discloses consumption and emissions. The least efficient homes (rated F and G) are progressively subject to restrictions on being rented out.
Due diligence
Pre-purchase audit verifying a property's legal, technical and financial status: title of ownership, debts, charges, planning compliance and any mortgages. It mitigates hidden risks before signing. In markets with less centralised land registries, such as Bali, it is essential to confirm the exact nature of the right held.
Leverage
Leverage means funding part of a purchase with debt to amplify the return on equity when the property's yield exceeds the cost of borrowing. Used well, it raises the cash-on-cash return. But it cuts both ways: if yields fall or rates rise, losses are magnified to the same degree.
Ejari
Dubai's mandatory tenancy registration system, overseen by RERA. Every residential or commercial lease must be registered to be legally enforceable and to unlock services such as DEWA connection, residence visa and permits. For an investor, Ejari formalises the landlord-tenant relationship and secures legal remedies in case of dispute.
DLD off-plan registration (Oqood)
Mandatory registration of an off-plan sale on the Dubai Land Department's interim register, evidenced by the Oqood certificate. It secures the buyer's rights before completion and is a precondition for issuing the final title deed. Registration fees (typically 4% of the price plus admin charges) apply.
Form F (MOU)
The Dubai Land Department's standardised sale contract, also called the MOU (Memorandum of Understanding), used for resales between individuals on the secondary market. It sets the price, terms and deposit (usually 10%) and legally binds buyer and seller. Signing it precedes the NOC request to the developer and the transfer at the trustee office.
Property Management Fee
A commission paid to a management company that runs a rented property on the owner's behalf. For long-term lets it is often 5 to 10 percent of annual rent; for short-term lets it can reach 15 to 25 percent of revenue. It covers tenant sourcing, rent collection, maintenance and reporting, and reduces the net yield.
Notary Fees (Frais de notaire)
Acquisition costs paid when buying property in France, made up mainly of transfer taxes (for the State and local authorities), the notary's regulated fee, and disbursements. They total roughly 7-8% of the price for existing property and 2-3% for new builds. Budget them on top of the purchase price.
Completion guarantee
A guarantee provided by a developer, through a bank or insurer, assuring an off-plan buyer that the works will be completed even if the developer defaults. It protects funds paid in instalments during construction. In Dubai an equivalent mechanism relies on regulated trust accounts overseen by RERA.
Hak Guna Bangunan (HGB)
Hak Guna Bangunan (HGB) is a right to build and own a building on land for a fixed term (usually 30 years, renewable). A foreign individual cannot hold it directly, but a PT PMA (foreign-owned company) can. It is the legal basis for commercial and rental real-estate projects held through a company.
Hak Milik
Hak Milik is the Indonesian freehold title, the most complete and perpetual form of ownership. It is reserved exclusively for Indonesian citizens, so a foreigner can never hold it directly. Any scheme to circumvent this rule (a nominee) is legally void and risks loss of the property.
Hak Pakai
Hak Pakai is a right to use land available to foreign residents holding a valid stay permit. It applies notably to standalone houses and is granted for an initial term (often 30 years), renewable. It is one of the few ways for an individual foreigner to hold property directly in Indonesia.
Hak Sewa (leasehold)
Hak Sewa is the long-term lease or leasehold, the most common structure for foreigners in Bali. The investor rents the land for a long term (often 25 to 30 years, sometimes more) with renewal options negotiated in the contract. The land remains owned by the Indonesian lessor, so the extension right should be secured in writing.
Handover
The moment the developer delivers the completed unit to the buyer, once the completion certificate is issued and the price settled. The buyer takes possession, carries out the snagging inspection and can register title. Handover also triggers the start of service charges and any post-handover payment plan.
Holiday Homes Permit (DTCM)
A licence issued by Dubai's Department of Economy and Tourism (formerly DTCM) authorising short-term rental of a property to tourists. The operator must register each unit, meet quality standards and collect the Tourism Dirham. Without this permit, holiday-home letting is illegal in Dubai.
IFI (Real Estate Wealth Tax)
A French annual tax on a household's net real estate assets when their taxable value exceeds a legal threshold. It covers property held directly or through companies, after deducting related debts. The scale is progressive and also applies to non-residents on their French-located assets.
IMB / PBG
The IMB (Izin Mendirikan Bangunan) was the Indonesian building permit, replaced since the reform by the PBG (Persetujuan Bangunan Gedung), a building approval based on compliance with technical standards. A property without a valid PBG is non-compliant and hard to operate or resell. Checking the existence and compliance of this permit is a key point of any due diligence in Bali.
Co-ownership (undivided)
A situation where several people jointly hold a property without physical division, each owning a share. Major decisions require the co-owners' agreement and any co-owner can request partition. An indivision agreement can organise management and limit deadlocks between co-buyers.
Initial Sale Contract
The first contract signed directly with the developer when buying off-plan, distinct from a secondary-market resale. It sets the price, the construction-linked payment schedule and the delivery obligations. This contract underpins the Oqood registration and precedes the issuance of the Title Deed at handover.
Integrated Tourist Resort (ITR)
The Maldivian tourism development model in which an entire island is leased from the state to operate a self-contained resort (accommodation, dining, leisure). In the Maldives, property investment almost always runs through this leased-resort structure, as outright freehold land sales to foreigners are heavily restricted.
Investment Zones
Designated areas of Abu Dhabi (Yas Island, Saadiyat, Al Reem, Al Maryah and others) where foreign nationals have been able to buy freehold property since 2019. Outside these zones, non-Emiratis are generally limited to musataha or usufruct rights, making it essential to confirm a plot's land status before purchasing.
LMNP (Non-Professional Furnished Landlord)
A French tax status for renting out furnished housing when the income stays secondary. Rents are taxed as industrial and commercial profits (BIC), with a choice between the flat-rate micro-BIC scheme or the actual-expenses regime, which allows deducting costs and depreciating the property. Widely used to optimise rental taxation.
Carrez Law
French rules requiring the exact private floor area of a co-ownership unit to be stated when sold. The calculation excludes areas with a ceiling height below 1.80 m and certain annexes. If the actual area is more than 5% smaller than declared, the buyer may be entitled to a price reduction.
Malraux Law
A French tax incentive promoting the restoration of old buildings located in protected heritage areas. It grants an income-tax reduction calculated on the renovation works, within a multi-year ceiling. Conditional on renting out the property for several years after the works.
LTV (loan-to-value)
LTV expresses the loan amount as a percentage of the property's value: a 700,000 loan on a 1,000,000 property gives an LTV of 70%. The higher the ratio, the smaller the down payment and the greater the lender's risk. Banks often cap LTV based on the buyer's profile, the property type and the borrower's tax residency.
Master developer vs sub-developer
The master developer builds out an entire district (infrastructure, roads, utilities, master plan), e.g. Emaar or Nakheel in Dubai. A sub-developer buys plots within that district to deliver individual projects. The distinction affects the quality of shared areas, community fees and overall delivery reliability.
Construction-linked payment milestone
Staged installments tied to construction milestones (foundations, a set % of the structure, completion) rather than fixed calendar dates. In the UAE these payments flow through the escrow account and are released to the developer only after an approved consultant certifies the works, protecting the off-plan buyer.
Mortgage cap (LTV limit)
A financing ceiling set by the UAE Central Bank, expressed as a loan-to-value (LTV) ratio. For a non-resident, the borrowable share is generally lower than for a resident, requiring a larger down payment. The cap varies with the property's value, the borrower's status, and whether it is a first or second purchase.
Musataha
An Abu Dhabi property right entitling the holder to build, use and alter structures on land owned by another, for a maximum renewable term of 50 years. A musataha is transferable and can be mortgaged, making it a common vehicle for foreign investors wishing to develop an asset without owning the underlying land freehold.
Nominee Agreement
A nominee agreement is a scheme where a foreigner buys property under an Indonesian proxy's name while claiming real control through side contracts. This practice is prohibited under Indonesian law: because the title is void, the foreigner has no legal protection and risks losing the property entirely. Hak Pakai, leasehold or PT PMA structures are the only safe alternatives.
Notaris / PPAT
The notaris is the Indonesian notary and the PPAT (Pejabat Pembuat Akta Tanah) is the officer authorized to draw up land-rights transfer deeds. Often combined in one person, these roles are essential to authenticate a sale, lease or title transfer. The PPAT checks the title with the land registry and records the transaction, ensuring its legal validity.
Bare ownership
Ownership of an asset without the right to use or enjoy it, that enjoyment belonging to the usufructuary. The bare owner regains full ownership when the usufruct ends, often on death or at an agreed term. Bought at a discount, it is a long-term tool for transmission and investment.
Oqood
Dubai's official registration system for off-plan property sales, managed by the Dubai Land Department through the developer's portal. The Oqood acts as an interim title that records the buyer in the provisional register until handover and issuance of the final Title Deed. Registration legally protects the buyer and is a prerequisite for any resale.
Staged payment plan
A payment plan spreads the price across several instalments tied to construction progress or a fixed schedule (e.g. 20% on reservation, the balance on handover). Common on new builds, it lowers the upfront outlay and eases cash-flow strain. Terms, late-payment penalties and post-handover plans vary by developer.
Individual Capital Gains (holding-period allowances)
The gain realised when an individual resells a property, taxed under income tax plus social levies. Progressive allowances based on the holding period reduce the taxable base, leading to full exemption after a set number of years. A main residence is itself exempt from this tax.
Power of Attorney
A deed by which an investor authorises a third party to act on their behalf: sign a deed, collect rents, manage a property. In Dubai and Abu Dhabi the POA must be notarised and sometimes legalised to be enforceable. It enables remote purchases but should be scoped and revocable to protect the grantor.
PT PMA
A PT PMA (Penanaman Modal Asing) is an Indonesian limited company with foreign ownership, the main legal route for a foreigner to invest in rental real estate in Bali. It can hold Hak Guna Bangunan or Hak Pakai titles, operate villas and issue invoices. Setting it up requires a minimum capital and ongoing tax and accounting obligations.
Gross vs net yield
Gross yield divides annual rent by purchase price, with no costs deducted. Net yield subtracts recurring expenses: service charges, taxes, management, insurance, maintenance and sometimes vacancy. The gap between the two can be substantial; investors compare assets on a net basis to gauge a property's true profitability.
Gross vs Net Rental Yield
Gross yield divides annual rent by the purchase price, before any costs. Net yield subtracts service charges, management fees, maintenance, taxes and vacancy, giving a more realistic figure. Comparing both matters: an attractive gross can shrink once operating costs are factored in. No yield is ever guaranteed.
Ejari Renewal
Ejari is Dubai's mandatory tenancy-registration system, run by RERA. Each time a lease is renewed, the contract must be re-registered to stay valid and enforceable. The Ejari certificate is required for DEWA utility connections, visa applications and any official process tied to the home.
Rental guarantee
A rental guarantee is a contractual commitment by which a developer or operator pays the buyer a fixed rent for a set period, whether or not the unit is let. Often offered on new builds, it secures short-term income. Investors should check the issuer's financial strength and what happens once the guaranteed period ends.
RERA Rental Index (rent calculator)
An official index published by RERA through the Dubai REST app that sets a reference rent range by area and property type. It governs permitted increases at renewal: a rent well below market may be raised in steps according to a scale. Investors and tenants use it to check whether a rent rise is legal.
Sandbank / Lagoon Lease
A lease granted by the Maldivian state over a sandbank or lagoon for tourism development, such as an overwater resort or reclaimed island. Subject to durations set under the Tourism Act and to environmental impact assessments, this type of lease carries specific risks tied to erosion and rising sea levels.
SCI (Non-Trading Property Company)
A French legal structure letting several people own and manage real estate through company shares. It eases estate transfer, multi-owner organisation, and tax choices (income tax or corporate tax transparency). Members are liable for debts in proportion to their shareholdings.
Show unit (model apartment)
A furnished, styled unit presented by the developer to showcase an off-plan project. It helps visualise layout and finishes, but may differ from the delivered home (furniture excluded, upgraded specs on display). Buyers should rely on the specification sheet and contract rather than on the show unit alone.
Sinking fund
A long-term reserve built up by owners through their service charges to fund major works and the replacement of heavy assets (lifts, roof, façade). In Dubai it is governed by jointly owned property rules and managed by the Owners Association. An underfunded reserve can lead to special one-off levies on owners.
Tamleek / DARI
Tamleek refers to full freehold ownership under Abu Dhabi land law, granting perpetual ownership of both the property and the land. DARI is the official digital platform of the Department of Municipalities and Transport used to register transactions, check the land registry and issue ownership title deeds (the Tamleek certificate).
Title Deed (Mulkiya)
The final ownership certificate issued by the Land Department, known as Mulkiya in Arabic. It records the owner's identity, the nature of the right (freehold or leasehold), the area and location of the property. It is the central legal document in any transaction: its issuance marks the effective transfer of ownership after handover or resale.
Tourism Dirham
A per-night tourism fee charged to guests of hotels and holiday homes in Dubai (with an equivalent in Abu Dhabi). The amount depends on the property's category, typically AED 7 to 20 per room per night. The operator collects it from the guest and remits it to the authorities, which affects the net nightly rate.
IRR (internal rate of return)
The internal rate of return (IRR) is the discount rate that brings the net present value of all an investment's cash flows to zero: initial outlays, net rents, works and resale price. It summarizes annualized performance while accounting for the timing of cash flows. It is the benchmark metric for comparing projects of different durations and structures.
Trustee Office (registration office)
A private office accredited by the Dubai Land Department where the official transfer of ownership between buyer and seller takes place. The trustee verifies documents, collects transfer fees and manager's cheques, then registers the transaction and triggers issuance of the new Title Deed. The transfer appointment is held there in the presence of the parties.
Usufruct (99-year usufruct)
An Abu Dhabi right of enjoyment allowing the holder to use a property and collect its benefits for up to 99 years, without owning the freehold. Often available to foreigners outside investment zones, the usufruct is transferable and registrable, but the land reverts to the original owner once the term expires.
Usufruct
A real right to use a property and collect its income (rents) without holding full ownership. It is distinct from bare ownership, which holds the asset without enjoyment. Usufruct can be for life or for a fixed term and underpins estate-planning structures that optimise transmission of wealth.