Can Dubai developers cancel an off-plan property contract if a buyer misses payments, and how much money can they retain?

Dubai developers cannot automatically cancel an off-plan contract or keep a buyer’s payments simply because an instalment is missed. Under Article 11 of Dubai Law No. 13 of 2008, as amended, the developer must notify the Dubai Land Department (DLD), which verifies the default and gives the buyer 30 days to pay or reach a settlement. The developer’s options and permitted deductions depend on the project’s completion stage: deductions may reach 40 per cent of the unit’s value when completion exceeds 60 per cent, fall to 25 per cent when construction has started but completion is below 60 per cent, or reach 30 per cent of the amounts paid if construction has not started for qualifying reasons beyond the developer’s control. Buyers may challenge unlawful action through court or arbitration, while buyers in projects formally cancelled by RERA are entitled to a full refund under the applicable law. The key takeaway: Dubai law protects developers’ rights while requiring them to follow a prescribed legal process.