Things to Check Before Signing a Sales Purchase Agreement (SPA)

When buying a property in Dubai, one of the most crucial steps in the process is signing the Sales Purchase Agreement (SPA). This legally binding document outlines the terms and conditions of the property transaction between the buyer and the seller (often a developer).

For many investors and homebuyers, especially those new to Dubai’s real estate landscape, the SPA can seem overwhelming. However, understanding what to look for before signing it can protect you from future disputes, delays, or financial loss.

Here’s your detailed checklist of everything you should verify before signing a SPA in Dubai:

1. Verify Developer’s Approval and Project Status

• Is the project approved by RERA (Real Estate Regulatory Agency)?
• Does the developer have an escrow account in place?
• Is the land title registered under the developer’s name?
• Has construction already begun, and what’s the current progress?

Why it matters: RERA-approved projects follow strict regulations ensuring your money is protected via escrow, and that the developer is held accountable for construction progress.

2. Cross-Check the Property Details

• Unit number, size (in sq. ft.), and floor plan
• Balcony, parking, and storage space included
• Exact view (community, sea, city, etc.)
• Orientation (corner unit, sun-facing, etc.)

Why it matters: Many buyers assume the advertised unit is what they’ll receive. The SPA must match the promised details precisely, or else you could be handed a smaller or less desirable unit.

3. Understand the Total Purchase Price Breakdown

• Base price per sq. ft.
• VAT (if applicable)
• DLD Registration Fee (4%)
• Agency commission (usually 2%)
• Oqood registration (for off-plan, usually AED 5,250)
• Service charges estimate

Why it matters: Knowing the exact financial commitment upfront helps you avoid surprise charges later on.

4. Review the Payment Plan Structure

• Booking amount
• Installment milestones (linked to construction or dates)
• Post-handover payments (if any)
• Final handover payment
• Late payment penalties

Why it matters: Many developers offer flexible payment plans—especially for off-plan properties—but these must be detailed in the SPA. Missing a payment due to unclear terms can lead to cancellation and penalties.

5. Check the Completion & Handover Date

• What is the estimated handover date?
• Is there a grace period (usually 6-12 months)?
• Is there any penalty clause if the developer delays?
• Will you receive compensation for delays?

Why it matters: Developers can delay projects, but a smart SPA includes protective clauses that penalize late handovers or allow buyers to cancel with a refund.

6. Inspect the Defects Liability Period & Warranty

• How long is the warranty period (usually 1 year for snagging, 10 years for structural)?
• Is there a clear process to raise maintenance or construction defects?
• Is the contractor’s name mentioned for accountability?

Why it matters: Many buyers assume they’ll receive a perfect unit. But if any faults arise, your SPA should clearly define who fixes what—and within what timeframe.

7. Check Termination & Refund Clauses

• Under what conditions can the developer cancel the agreement?
• Can you terminate the SPA if the developer delays or violates terms?
• What happens to your payments in case of cancellation?

Why it matters: SPAs heavily protect developers unless you ensure clear refund policies and buyer rights are defined.

8. Ensure Proper Escrow Protection

Dubai mandates that off-plan payments go through an RERA-approved escrow account, not the developer directly. Ensure:

• Escrow account details are listed in the SPA
• The developer can only withdraw based on construction progress
• You receive periodic progress updates and receipts

Why it matters: This is your financial safety net. It ensures that if the project stalls or the developer defaults, your money is safe.

9. Review the Dispute Resolution Mechanism

• Jurisdiction: Typically, Dubai courts handle disputes
• Is there an arbitration clause?
• What is the process for raising complaints?

Why it matters: If things go wrong, you want a clear legal route that favors fast resolution without endless legal complications.

10. Final Review by a Legal Expert

It is strongly recommended to have your SPA reviewed by:

• A real estate lawyer licensed in Dubai
• A trusted agent or consultant (like DSX Properties)
• Or both

Why it matters: An expert can spot loopholes, missing clauses, and one-sided terms you might overlook.

Common Mistakes Buyers Make Before Signing the SPA

• Not verifying if the developer is approved by DLD/RERA
• Overlooking the fine print in the payment plan
• Ignoring the unit layout or wrongly assuming specifications
• Trusting verbal promises that aren’t in the SPA
• Not asking about construction-linked vs. fixed-date plans

Remember: If it’s not written in the SPA, it doesn’t count—no matter what the agent or developer says.

Pro Tip: Always Ask These Questions Before Signing

• Is this the final version of the SPA or a draft?
• What’s the exact cancellation policy?
• Can I resell the property before handover?
• Are all payment deadlines aligned with my financial plan?

Conclusion: Your SPA Is Your Safety Net

Signing a Sales Purchase Agreement is a milestone—but it’s also the last line of protection before you're legally and financially locked into a deal.

Whether you're buying an off-plan unit in Dubai South or a ready apartment in Marina, the SPA sets the rules for:

• Payment
• Delivery
• Legal rights
• Investment returns

Don’t rush it. Be informed. And always ask for legal review before signing.

Thinking of Buying Property in Dubai?

At DSX Properties, we guide you through every legal and investment step. From selecting the right project to ensuring your SPA is investor-safe, we protect your interests from start to finish.

Contact us now to schedule a free consultation with our experts.