What Happens If an Off-Plan Project Gets Cancelled in Dubai?

Buying an off-plan property in Dubai offers attractive pricing and high return potential — but buyers often ask one key question: what happens if a project gets cancelled?

Dubai has one of the most buyer-protective frameworks globally. Under RERA Law No. 8 of 2007, investors are legally protected and, in many cases, entitled to recover up to 100% of their paid amount.

Key protections are built into the escrow system and enforced through official legal liquidation processes.

Law

RERA Law No. 8 (2007)

Protection Mechanism

RERA-Monitored Escrow

Refund Potential

Up to 100%*

Decision Authority

Special Tribunal

*Eligibility depends on official cancellation status and construction progress.

Understanding RERA Law No. 8 of 2007

RERA (Real Estate Regulatory Agency), operating under the Dubai Land Department (DLD), introduced Law No. 8 of 2007 to regulate off-plan property sales and safeguard buyer funds.

The law mandates that all buyer payments must be deposited into a RERA-monitored escrow account. These funds are ring-fenced and cannot be accessed freely by developers.

What Is a RERA-Monitored Escrow Account?

An escrow account is a dedicated bank account opened for a specific real estate project. Buyer payments are released to the developer only after certified construction milestones are verified by authorities.

If a project stalls or is cancelled, the remaining funds stay protected within the escrow account.

When Is a Buyer Eligible for a Refund?

Buyers may be eligible for partial or full refunds in cases where:

• The project is officially cancelled by DLD or RERA

• Construction has not commenced

• The developer fails to meet contractual milestones

In cases of no construction, buyers are often entitled to a 100% refund.

Step-by-Step Process to Claim Your Refund

Confirm Official Project Status

Verify the project status through the Dubai Land Department (DLD) or RERA official portals. Only officially cancelled projects qualify for legal liquidation.

Prepare Documentation

Collect the Sale & Purchase Agreement (SPA), payment receipts, bank transfer proofs, and any correspondence with the developer.

File a Case with the Special Tribunal

Submit a grievance to the Special Tribunal for Liquidation of Cancelled Real Property Projects. The tribunal evaluates escrow balances and orders fund distribution.

Common Mistakes Buyers Should Avoid

• Assuming funds are lost without checking legal options

• Relying on unofficial project updates

• Delaying grievance filing

• Submitting incomplete documentation

How Haus 51 Supports Buyers

Haus 51 provides expert guidance for investors dealing with cancelled projects. Our team assists with project verification, documentation strategy, legal process navigation, and reinvestment planning after refunds.