Off-plan escrow in Dubai: how it protects your money

When you buy off-plan in Dubai, you pay for a building that does not exist yet. The law’s answer is the escrow account: a bank account in the project’s name, which the developer cannot treat as its own pocket. This guide explains what the law says, when the developer can touch your money, how to look up a project on the DLD site, and what the escrow does not promise.

What is an off-plan escrow account in Dubai?

The DLD’s FAQ describes it as the bank account of a real estate project, where the money collected from buyers (and project financiers) is held. It must be opened in the name of the project. The law covers all real estate developers in Dubai without exception, and it applies to projects announced before or after the law was published.

What does Law No. 8 of 2007 say?

Law No. 8 of 2007 on escrow accounts for real estate development is the base of the system. The table summarises the English text on Dubai’s legal portal. The Arabic text prevails if the two differ.

Article	What it says
6 and 7	A developer must apply to the Land Department to open an escrow account. The application includes the trade licence, the land title deed, a standard sale contract and a cost-and-revenue statement certified by an accredited auditor. The account is opened under a written agreement with an escrow agent.
9	The account is dedicated exclusively to construction of that project. A developer with several projects needs a separate account for each.
11 and 12	The escrow agent must give regular statements of income and spending. Depositors or their representatives can access and copy the account records.
13	If the project is mortgaged, the loan proceeds must be paid into the same escrow account.
14	After the completion certificate, the escrow agent keeps 5% of the account’s total value, released to the developer one year after units are registered in buyers’ names.
15	In an emergency, the escrow agent must take the steps needed to protect depositors’ rights. The aim is to finish the project or refund buyers’ payments.
16 and 17	Offences such as misusing project funds carry jail and/or a fine of at least AED 100,000. A developer can be struck off the register, for example if construction does not start within six months of off-plan approval.

When does the developer get your money?

Not all at once. The DLD FAQ says escrow money can only go to contractors, consultants and marketing for that project, and that payments are released at construction milestones after the account’s trustee verifies the work. Marketing is capped at 5% of total sales. I did not find an official page that lists the release percentage for each stage, so I cannot give you a stage-by-stage schedule. Ask the developer which milestones apply to your project.

One point where the sources differ: the law (Article 14) says the 5% retention is released one year after units are registered in buyers’ names, while the DLD FAQ says one year after completion. Both describe a holdback for defects. Neither changes what you pay.

What is the Oqood and why does it matter?

The escrow protects where your money goes. The Oqood protects your claim to the unit. Under Law No. 13 of 2008, off-plan sales are entered in the Interim Property Register, and a sale that is not entered there is void. The law also bars developers from selling off-plan before they own the land and hold the required approvals, and it requires developers to register their broker contracts.

The DLD’s page for registering an initial sale says the sale and purchase contract must be registered in the provisional register within 90 days of signing, and that both developer and buyer sign it. Payment can be made from the Noqodi wallet or deducted from the escrow account. You receive a provisional registration e-certificate by email. Keep it. It is your proof of ownership until the title deed is issued.

How do I check a project’s escrow account?

The DLD has a free Project Status service. It works on the DLD website, in the Dubai REST app, and on WhatsApp through the Land Department’s number 8004488. Follow these steps:

1. Copy the exact project name and number from your reservation form or sales contract.
2. Search the project by land number, project number or project name. The DLD says the result appears immediately.
3. Open the project’s page. It has tabs for the fact sheet, inspection details, developer details, management companies and an Escrow Account tab with a bank-name field.
4. Check the completion percentage and the registered start and completion dates against what the sales team told you.
5. Compare the escrow bank with the payment instructions in your contract. Pay only into the escrow account named there, never to the developer’s general account or a broker’s account.
6. After you pay, make sure the sale is registered and keep the Oqood certificate.

I could see the labels on the DLD project page but not a live record, so I cannot tell you exactly which escrow details appear for every project. If the tab is empty or the project is missing, ask the developer and the DLD (call 8004488) before you pay another instalment.

What if the project stalls or is cancelled?

The DLD FAQ gives these rules:

• The DLD cannot end a contract between you and the developer on your request. Disputes go to the real estate court, with the DLD helping the parties settle.
• If a project is cancelled, the escrow account moves to the DLD’s project liquidation department, which asks the developer to return the funds within 60 days of the cancellation decision. If the developer does not comply, the case goes to court.
• If completion is 5% or less and the project is not cancelled, the DLD contacts the developer and gives it time to correct the situation. If it does not, RERA starts cancellation procedures.
• You can ask for a technical audit report on completion. The FAQ says the RERA technical auditor prepares it after payment of an audit fee of AED 15,000.

What does escrow not do?

It does not guarantee the price, the finish or the handover date. The law gives the escrow agent a duty to protect depositors in an emergency, with completion or refund as the aim, but a refund depends on what is in the account and what the court decides. So check the developer’s record, read the sales contract, and look at the project status page again before every instalment. The DLD FAQ says investors can check completion on the DLD site or app before paying a scheduled instalment.

Check the latest rules with DLD or a licensed broker before you sign.