Understanding Power of Attorney for Property Transactions

What Is Power of Attorney?

A Power of Attorney is a legal document authorising another person or entity to act on someone else’s behalf within the powers specified in the document. In Dubai real estate, a properly legalised PoA can allow a representative to carry out property transactions or related actions when the owner or buyer is unable to attend personally.

This is one of the most valuable documents for real estate dealings as it is of great aid to property owners in the UAE who may want to sell their property but aren’t physically present in the country for the transactions. 

How Can Power of Attorney Be Used to Purchase or Sell Property?

The powers available to the representative depend entirely on what the PoA expressly authorises. Depending on its wording, a PoA may be used to:

• Buy or sell property

• Complete property registration procedures

• Sign transaction documents

• Deal with mortgage-related matters

• Manage or lease property

• Handle specific administrative matters relating to the property

The representative cannot automatically carry out every property-related action simply because they hold a PoA. Their authority is limited to the powers stated in the document.

When Can Power of Attorney Be Used in Property Transactions?

A Power of Attorney can be used where the property owner or buyer cannot attend the transaction personally, provided the representative is acting within the authority granted by a valid and properly legalised PoA. Dubai Land Department expressly allows legal representatives to transact property within the limits of the powers stated in the document.  

This may include buying or selling property, completing mortgage-related transactions or carrying out other expressly authorised real estate procedures.

How to Grant Power of Attorney for Property Transactions

Having understood the functions of a power of attorney for the purchase of property or transfer of property, let us understand how one can obtain this legal document. 

The process has many steps and it is important to adhere to each one to facilitate the process. Here are some key points to keep in mind:

• The document must be in a form accepted by the relevant UAE authorities. Where a foreign-language document is used, an approved Arabic legal translation may be required.

• If your power of attorney document is issued in another country, it must be legalised by the UAE embassy and the Ministry of Foreign Affairs 

• For a property sale or other high-value transaction, the PoA should clearly identify the relevant property and the specific powers being granted. Broad or ambiguous wording may create problems when the document is reviewed for registration.

• For DLD property transactions, a Power of Attorney covering sale, mortgage or grant transactions is valid for two years from the date of notarisation. For property purchases, DLD states that the validity period is five years.  

Risks of Using Power of Attorney in Property Deals

It is important to understand the risks associated with giving a power of attorney to someone. Understanding and weighing both sides will aid you in making an informed decision. 

• Grant only the powers necessary for the intended transaction

• Clearly identify the property and actions the representative may perform

• Choose a representative you trust

• Avoid unnecessarily broad financial or disposal powers

• Confirm that the PoA meets DLD and notarial requirements before relying on it for a transaction

• Seek independent legal advice where the transaction or powers are complex

Can Power of Attorney Be Revoked in Property Transactions?

A Power of Attorney can generally be revoked by the person who granted it, subject to the relevant notarisation and notification procedures. The principal should ensure the revocation is formally recorded and that the representative and any parties relying on the original PoA are notified where necessary.

Because a revocation may not automatically resolve transactions already completed under a valid PoA, legal advice may be appropriate where a property transaction is already in progress.

How Long Is a Power of Attorney Valid for Dubai Property Transactions?

Dubai Land Department currently states that a Power of Attorney used for sale, mortgage or grant transactions is valid for two years from the date of notarisation. A PoA used for the purchase of property is valid for five years.

The representative must still act within the specific powers granted in the document, and the PoA must remain properly legalised and acceptable for the intended transaction.

Conclusion

A Power of Attorney can make Dubai property transactions significantly easier when an owner or buyer is unable to attend in person, but its usefulness depends on how clearly and correctly it has been prepared.

The document should define the representative’s authority carefully, comply with the relevant notarisation and legalisation requirements and remain within the validity periods accepted by Dubai Land Department. For overseas-issued PoAs or complex transactions, professional legal advice can help reduce the risk of delays or rejection.

Engel & Völkers Dubai can support buyers and sellers with the property transaction itself and help coordinate the documentation required for the applicable DLD process, while legal advice on the drafting or scope of a Power of Attorney should be obtained from an appropriately qualified professional.