Escrow Account for Off-Plan Property in Dubai: How Law No. 8 of 2007 Protects Buyers

An escrow account in Dubai is a bank account opened in the name of one off-plan project, into which the payments of off-plan buyers and project financiers are deposited. Under Law No. 8 of 2007 the money is dedicated exclusively to building that project, and the Dubai Land Department (DLD) accredits the bank that manages it.

What is an escrow account in Dubai?

It is the project's own bank account for off-plan money. Article 2 of Law No. 8 of 2007 Concerning Escrow Accounts for Real Estate Development in the Emirate of Dubai defines it as "the bank account of a real estate development project in which the payments made by purchasers of Units sold off-plan or by the financers of the project are deposited".

The law was issued on 6 May 2007 and, according to the DLD's FAQ, became effective on June 28, 2007. Its core rules for buyers are short:

• One project, one account. Article 9 says the account is opened in the name of the project and is dedicated exclusively to the construction of that project. A developer with several projects must hold a separate escrow account for each.
• No creditor claims. Article 9 also says no attachment may be imposed on the deposited payments for the benefit of the developer's creditors.
• Access to records. Under Article 12, depositors or their representatives may see their own accounting records and request copies.
• A 5% holdback. Article 14 requires the escrow agent to retain 5% of the total value of the account once the developer obtains the completion certificate, released one year from the registration of units in purchasers' names.

The complete guide to buying off-plan in Dubai covers the wider process, and the payment plan calculator shows what each instalment comes to.

Who holds the money in escrow?

A bank or financial institution, not the developer and not a broker. Law No. 8 of 2007 calls it the Escrow Agent: "the financial or banking institution accredited by the Department to manage an Escrow Account". The DLD FAQ describes who qualifies: any bank or financial institution licensed by the Central Bank of the UAE to receive third-party deposits and operating in Dubai as an account trustee, provided it is approved by RERA.

Before selling off-plan, the developer must be entered in the DLD's Register of Real Estate Developers (Article 4) and must ask the DLD to open an escrow account (Article 6). The agent must send the DLD regular statements of the account's revenue and expenditure (Article 11).

Can I withdraw money from escrow?

No. Article 9 of Law No. 8 of 2007 dedicates the account exclusively to construction, and the developer cannot draw on it freely either.

According to the DLD FAQ, payments from an escrow account are, as a general rule, only for the contractors, consultants and marketing involved in the project, and only 5% of total sales can be paid for marketing. The same FAQ sets out how a release works:

1. The agreement between the developer and the account trustee lists the major construction stages that must be completed before money is released.
2. The developer's project manager tells the trustee when a milestone is complete and submits a payment request.
3. The trustee's engineer visits the site, and once the stage is verified the trustee is authorised to disburse the payment.

The FAQ adds that where instalments follow construction progress, the investor is entitled to a letter from the DLD-approved project consultant stating the current completion percentage, and is otherwise not obliged to pay until the agreed stage is confirmed.

How to check the escrow account of a Dubai project

Use the DLD's own project lookup, which includes an Escrow Account tab with a Bank Name field.

1. Open the DLD real estate project status service and search by project name or project number.
2. Open the project and read the Escrow Account tab for the bank name.
3. Compare that bank with the payment instructions in your sale agreement. Article 9 requires the account to be in the name of the project.
4. Check that the bank appears on the DLD list of approved escrow account trustees.

The same page says project status is also available in the Dubai REST app under Project Status (Mashrooi). Browse off-plan projects in Dubai to find a project name to search for. The DLD project status check guide covers the service in full.

Which bank is best for an escrow account?

There is no official ranking, and the buyer does not choose: the developer signs the escrow agreement with the trustee. The useful check is whether that bank is approved. The DLD publishes the list of approved escrow account trustees, which showed 30 records when checked on 10 November 2026, with phone, fax and website columns for each.

Do I get escrow money back if the project is cancelled?

Yes when the project itself is cancelled, but not simply because you change your mind. Three situations differ:

• Project cancelled by RERA, or never started for reasons outside the developer's control. Article 11(b) of Law No. 13 of 2008 as replaced by Law No. 19 of 2020 says the developer must refund all payments made by the purchasers, following the procedures of Law No. 8 of 2007.
• Project not completed in an emergency. Article 15 of Law No. 8 of 2007 requires the escrow agent, after consulting the DLD, to take measures to preserve depositors' rights and ensure that the project is completed or depositors are refunded.
• Project still live and the buyer wants out. The DLD FAQ states that the department has no authority to terminate a contract at the investor's request; it says an investor who wishes to terminate a contract with the developer should go to the real estate court, and that its own role is limited to reconciling the two parties.

On a cancelled project, the DLD FAQ says the developer is asked to return investors' payments within 60 days of the cancellation decision, and that the liquidation section distributes the escrow amounts to beneficiaries "either in full or in proportion, depending on the amount available in the account".

What happens if the buyer defaults on payments?

Article 11 of Law No. 13 of 2008, in the wording substituted by Law No. 19 of 2020 (issued on 24 November 2020), sets a fixed procedure:

1. The developer notifies the DLD of the breach on the DLD's form.
2. After verifying the breach, the DLD serves a written 30 day notice on the purchaser and, where possible, mediates an amicable settlement.
3. If the notice expires with no payment and no settlement, the DLD issues an official document confirming the developer followed the procedure and stating the project's percentage of completion.
4. The developer may then act without recourse to courts or arbitration, within these limits:

Project completion	What the developer may do
More than 80%	Keep the agreement, retain all amounts paid and claim the balance; or ask the DLD to sell the unit by public auction; or terminate and retain up to 40% of the unit value in the agreement.
Between 60% and 80%	Terminate and retain up to 40% of the unit value.
Work started, less than 60%	Terminate and retain up to 25% of the unit value.
Work not started for reasons beyond the developer's control	Refund all payments made by the purchasers.

The percentages are of the value of the unit stated in the agreement, not of what has been paid. As an illustration, 25% of an AED 1,000,000 unit is AED 250,000, so a buyer who had paid AED 300,000 would be owed AED 50,000. The refund is not immediate: the developer must return the excess within one year of termination or within 60 days of reselling the unit, whichever is earlier.

A 30% deduction where work has not started comes from the 2017 version of the article (30% of the amounts paid); the 2020 text replaced it with a full refund. Article 11 also says its rules are part of public order and do not stop the purchaser going to court or arbitration.

How do I file a DLD or RERA complaint?

Start on the DLD Real Estate Complaints page. On 10 November 2026 its options included:

• Complaint Against a Real Estate Company, for recording notes and complaints.
• RVS Complaint Tracking, for complaints against real estate companies and brokers for violating real estate laws and regulations.

The page lists the DLD call support number as 8004488. A complaint is not a refund order: per the DLD FAQ, ending a live contract at the buyer's request is a matter for the court, so a UAE-qualified property lawyer is the right source of advice on a specific contract.

Is escrow the same in Abu Dhabi?

No. Abu Dhabi has its own statute, Law No. 3 of 2015 as amended by Law No. 2 of 2025. A Department of Municipalities and Transport announcement describes Decision No. 24 of 2025, which regulates disbursements from project escrow accounts before 20 per cent project completion. The Dubai percentages in this guide do not carry over; see the ADREC Abu Dhabi off-plan guide.

Common mistakes

• Paying before the sale is registered. Article 3 of Law No. 13 of 2008 says a sale of an off-plan unit is void unless it is entered in the Interim Property Register, and Article 10 voids contracts in projects not approved by the competent entities.
• Treating escrow as a guarantee of completion. Article 16 of Law No. 8 of 2007 sets a jail sentence and a fine of at least AED 100,000, or either, for offences such as appropriating project money, but a project can still stall or be cancelled.

The guide to investing in off-plan projects in Dubai covers the other checks to make before signing.