You get 30 days' notice from the Dubai Land Department (DLD) to catch up. If you still have not paid or settled with the developer when that ends, the developer may cancel your purchase without going to court and keep up to 25% or 40% of the unit's price, depending on how far the project is built. Once a project is more than 80% complete, it may instead keep the contract, keep what you paid and claim the rest, or ask the DLD to auction the unit. These rules are in Article 11 of Dubai's Law No. 13 of 2008, in the version set by Law No. 19 of 2020.
This is a summary to help you understand the rules before you sign, not legal, tax or financial advice. If you are behind on payments, talk to the developer and to a lawyer.
Which law applies?
Off-plan sales in Dubai are governed by Law No. 13 of 2008, which created the Interim Property Register where every off-plan sale is recorded. Its Article 11, on buyers who do not pay, has been replaced three times:
| Version | What it allowed a developer to keep |
|---|---|
| Law No. 13 of 2008, the original | Up to 30% of what the buyer had paid |
| Law No. 9 of 2009 | A scale by construction progress, up to 40% of the unit's price |
| Law No. 19 of 2017 | A similar scale, measured on the unit, and the right to act without going to court |
| Law No. 19 of 2020, in force today | The scale below, measured on the whole project |
The 2020 law was issued on Nov 24, 2020 and came into force when it was published in the Official Gazette. Every rule below comes from its Article 11 unless another source is named. Its English text, like all of Dubai's official translations, says the Arabic original prevails if the two differ.
What happens first when you miss a payment?
The developer cannot simply cancel. The law sets out steps, in order:
- The developer reports you to the DLD, on the DLD's form, with both parties' details, a description of the unit and a detailed account of what you have not paid or done.
- The DLD checks the claim and gives you 30 days' notice to meet your obligations. The notice must be written and dated, and delivered in person, by registered mail with acknowledgment of receipt, by email or by another means the DLD sets. Keep your contact details up to date with the developer, because this is how you will hear.
- The DLD may mediate. Where possible it tries to reach an amicable settlement between you and the developer, such as a new schedule. A settlement is signed by both of you and attached to your sale agreement as an addendum.
- If the 30 days pass with no payment and no settlement, the DLD issues the developer an official document confirming that it followed these steps and stating the project's percentage of completion, worked out under the standards of the Real Estate Regulatory Agency (RERA).
Only after that document may the developer act, and then "without recourse to courts or arbitration", in the law's words.
How much can the developer keep?
It depends on how far the whole project is built, as certified by the DLD. The 2017 version measured the completion of your unit; the 2020 version measures the project.
| Project completion | What the developer may do |
|---|---|
| More than 80% | Keep the contract, keep everything you paid and claim the balance; or ask the DLD to sell the unit at public auction to collect what is owed, with the costs of the sale charged to you; or cancel and keep up to 40% of the unit's price |
| 60% to 80% | Cancel and keep up to 40% of the unit's price |
| Started, but below 60% | Cancel and keep up to 25% of the unit's price |
| Not started, for reasons outside the developer's control and without its fault | Refund everything you paid, under the escrow law |
Two things in that table are easy to misread:
- The caps are a share of the price, not of what you paid. On an AED 1,500,000 unit in a project 70% built, 40% is AED 600,000. If you had paid AED 750,000, up to AED 600,000 could be kept and at least AED 150,000 would come back to you. If you had paid AED 400,000, all of it could be kept.
- "Up to" is a ceiling. The developer may keep less, and the settlement step exists to find another way.
Whatever is owed back must be refunded within one year of the cancellation, or within 60 days of the unit being resold to another buyer, whichever comes first.
What if the project is canceled?
Then you get everything back. If RERA cancels a project by a final, reasoned decision, or the developer never started for reasons beyond its control, Article 11 has the developer refund all payments under Law No. 8 of 2007, the law on project escrow accounts that holds buyers' money during construction.
Can you still go to court?
Yes. The 2020 text says these rules do not stop a buyer from going to court or arbitration. It also says the steps are a matter of public order and that an act which does not follow them is void, so a cancellation that skips them is void under the law's own terms. The 2017 version had limited that right to cases where a developer abused its powers; the 2020 version drops that limit.
Two more points from the article:
- It covers old contracts too. The rules apply to off-plan agreements signed before or after the 2020 law took effect.
- It does not cover plain land sales. A sale of land that is not an off-plan sale follows its own contract instead.
Can you sell instead of defaulting?
Often, yes, and it is worth asking early. Article 6 of Law No. 13 of 2008 lets a unit sold off-plan and entered in the Interim Property Register be sold or mortgaged, and Article 7 bars the developer from charging fees on a resale beyond the administrative costs the DLD approves. Your own contract may set conditions for a resale before handover, such as a minimum share of the price paid, so read it and ask the developer what applies to you.
How do you avoid getting here?
- Read the payment plan as dates and amounts, not percentages, and check you can meet each one if your income dips. Our payment plan calculator turns a plan like "20 / 30 / 50" into a schedule.
- Look at what is due before handover. A plan that leaves part of the price until after you get the keys spreads the load: 157 of the 997 Dubai projects in our catalog, as imported on Nov 1, 2026, offer a post-handover plan, and the advisor can find them for you.
- Pay only into the escrow account named in your contract, and keep every receipt.
- Answer any DLD notice at once, and ask about a settlement during the 30 days rather than after them.
- Have a lawyer read the contract, including its own default clauses, before you sign.
You can browse every Dubai project we list, or by community, such as Business Bay, where this post's image comes from, or Jumeirah Village Circle. For the rest of the buying process, read Can foreigners buy off-plan property in Dubai?, and for the same question in another emirate, how Ras Al Khaimah protects off-plan buyers.