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There are several unusual traditions and definitions, which are peculiar for the local economy, which apply to the foreign citizens who enter the civil law relationships related to the real estate in the Emirates. In this article we will consider such a concept as Key Money. So, what does this concept mean and what are its legal consequences?

Key Money in Dubai, UAE

The term Key Money in the UAE means a certain amount of money, which is paid to the land owner when signing the lease. It is noteworthy that this amount complements the rent and serves as a kind of guarantor and symbol of the transferring of the right of possession of the property. At the end of the lease term, the amount, which was entered as Key Money, is not given back to the lessor.

Key Money: what is the essence of the guarantee payment

In fact, the Key Money payment is a payment that provides the owner of the property with a guarantee of the compliance with the term of the transaction. In other words, this payment serves as a guarantee that the tenant will not suddenly terminate the lease before the agreed term. As a rule, the size of this payment is comparable with the rent for a few months. The presence of the Key Money payment helps to reduce the total rental fee, so the property which is leased without the guarantee payment, will be more expensive.

If you enter into a rental agreement that provides for a guarantee payment, you should pay attention to the conditions of the contract extension. It may happen that at the end of the lease term, the property owner will require to make a guarantee payment again. You should also learn more about the conditions and possibilities of transferring the property to other owners. The cases are known when the new owner also demanded to make a guarantee payment again.

The amount of the lease and the related guarantee payment may depend on many objective factors. Among them there are the average rent of the real estate, the location of the object and the availability of the urban infrastructure.


Key Money payment in Dubai, the UAE, is a kind of the insurance for the owners of real property, which they grant on lease. Such a deposit guarantees the property owner, that in the case of the early termination of the lease contract or in the case of damaging the property, the caused losses will be reimbursed. Such an approach provides adequate protection of the legal owners and is an example of creating modern and civilized market relations.

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