Dubai’s market for timeshares has grown steadily since new regulations were introduced in 2021, and experts believe it is poised for further growth in 2024 after a record year for luxury real estate that saw property prices soar past previous market peaks.
“As property values continue to appreciate, [timeshares] may emerge as an increasingly appealing option for those seeking an affordable slice of ownership and a winter sun getaway in Dubai,” said Matthew Gregory, Branch Director at Better Homes.
“The undeniable truth is that property prices have experienced a significant surge over the last 2.5 years, potentially placing full ownership beyond the reach of many.”
A timeshare allows individuals to co-own a property like a hotel room or villa, and use it for a designated period each year. With soaring property prices in Dubai, the fractional ownership model provided by timeshares is becoming an attractive affordable option for those looking to tap into the emirate’s luxury property market.
“Timeshares offer individuals the opportunity to enjoy a specific area or city for a designated number of weeks per year – a personalised holiday home experience. Given the soaring property prices in recent years, this fractional ownership model becomes particularly appealing to those who might find owning a holiday home outright financially challenging,” said Gregory. He also noted a growing interest in Dubai timeshares as property prices surge.
“The standout properties in focus are those that epitomise the holiday vibe – picture locations near the sea or beach in vibrant areas of the city such as Dubai Marina and Palm Jumeirah. Nestled in the midst of restaurants and nightlife, though not directly on top of it unless you have a penchant for the energetic atmosphere of the FIVE Palm.”
“As a concept, timeshares are great for larger units such as villas or large apartments where families can split holidays between each other and have private spaces they can lock,” said Frank Porter CEO Anna Skigin.
This investment type “didn’t seem to take off initially as it limits investors to hotel properties only and requires a separate license to a Holiday Homes license,” she added, noting that investors can already purchase private properties as a group and have their individual names on the Title Deed, allowing them to rent out the properties short term as a holiday home and use them whenever they want to.
But for curious prospective buyers, here’s everything you need to know about buying a timeshare in Dubai.
How to buy a timeshare in Dubai
However, it is important to understand both the opportunities and responsibilities that come with purchasing a timeshare.
Established in 2021, Dubai Tourism’s Timeshare Portal streamlines contract registrations and facilitates resales or transfers of ownership rights. All new timeshare purchases must be registered on the portal by the developer to be made official.
Potential buyers can use the portal to search for available timeshares on the resale market.
However, in cases where an existing owner wishes to sell their timeshare, they can initiate the transfer of rights through the portal, ensuring the process is transparent and transaction made legally.
“While the platform has been somewhat overshadowed by the short-term rental market, it remains a hidden gem,” said Gregory.
Key timeshare regulations to know
Only properties classified as four or five-star hotels or luxury apartments may be used as timeshares. Ownership can be purchased either through a timeshare contract or points-based contract, Derek Robins, Associate at Dubai law firm BSA, told Arabian Business.
“The key aspect here is do your homework, make sure that the timeshare unit you wish to buy is registered with RERA [the Real Estate Regulatory Agency]. Make sure that the developer is also registered with the DET and is actually allowed to carry out this activity. Make your own investigations before getting into any binding commitments,” Robins said.
Here’s a list of key obligations that buyers (termed “beneficiaries”) must follow, according to BSA:
- Comply with contractual obligations
- Pay for using unit
- Maintain good condition throughout usage
- No improvements or structures
- Use the Unit for its intended purpose
- Return the Unit in the same condition found after stay
- Do not damage the Unit or impair its value
- Comply with the all applicable laws
- Ensure that the unit being utilised has been registered with the DET
- Notify the DET of any changes to the contract
Developers on the other hand must meet stringent standards for record-keeping and transparency. They are required to maintain detailed records on all timeshare contracts and points-based agreements, keeping them accessible to the DET for prescribed periods. Developers must also provide accurate unit information to beneficiaries, respond promptly to any DET complaints, and fully cooperate with regulatory authorities. This includes granting access to employee inspection of all activity contracts and records.
They are also prohibited from taking on unauthorised brokering roles. Instead, they must appoint experienced managers and comply with security, public health, environmental, and contractual obligations.
Additional responsibilities involve conducting regular maintenance, ensuring comprehensive insurance coverage, properly registering agreements, and outlining all applicable financial considerations – including fees, taxes, and additional costs – to beneficiaries transparently. Developers cannot impose extra charges not stipulated in contracts.
They are also expected to service units adequately by providing electricity, water, and internet access without charging beneficiaries. Warranties for defects must also be honoured. Maintaining thorough activity records, respecting beneficiary data privacy, submitting periodic DET reports, investigating complaints, and documenting the complaint handling process in accordance with regulatory standards are further key duties timeshare operators must fulfill under the law.
Protections for buyers
Buyers benefit from a 10-day cooling off period and right to carry over usage dates up to two years. If developers disturb usage or fail registration duties, beneficiaries can pursue legal remedies like termination, according to BSA.
The DET imposes rigorous licensing conditions on developers, setting baseline quality, financial security, and customer service standards. This acts as an assurance to beneficiaries that their units will be properly managed.
If developers are found disturbing a beneficiary’s peaceful enjoyment of their timeshare or failing to meet registration responsibilities, beneficiaries have legal recourse options like pursuing termination of the contract. This protects owners from any substandard treatment during their stays.
Beneficiaries are also entitled to request a 45-day carryover of their usage interval up to two years in advance from the developer if they are unable to travel as planned. This flexibility helps ensure the timeshare continues meeting owners’ needs in the long run.
Rights can also be unilaterally terminated within the first year of conclusion under specific circumstances like the lack of a required operating permit. In such cases, beneficiaries must be appropriately compensated for any financial considerations already provided under the agreement.
Importantly, any party – whether buyer or seller – can submit a formal grievance through the proper legal channels if they wish to dispute a decision or action taken according to Dubai’s timeshare regulations. This protects the rights of all stakeholders in the growing vacation ownership sector.
Prospective owners can also verify developers via RERA registration and the DET’s publicly available register of authorised operators.
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