What is an escrow account and how does it protect off-plan buyers in Dubai?

Under Dubai Law No. 8 of 2007, every off-plan developer must deposit buyer payments into a project-specific escrow account held by a DLD-approved trustee. Funds are released only against verified construction milestones, and 5% is retained for one year after completion to cover defects. If the project is cancelled, buyers are refunded from escrow ahead of the developer's other creditors.