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Partners in property investment.

Answered as per Hanafi Fiqh by Askimam.org

Regarding Fatwa#: 36515, following is the detail.

In a portion construction, a builder buys a land completely (mostly a building is built over it that is demolished after buying by the builder). Then he builds his own building over the land and sells each floor as a portion separately to different people.

In our case, our agent found a builder who was selling his (under-construction) building floorwise. The builder bought a building, demolished it and has now built a new building. We purchased a floor (also called as portion or flat in market terms) from the builder when it was under construction. We are willing to sell this portion at a higher rate once its near completion or get completed. This will most probably get us profit on the investment.


Below is my previous query:

All figures are examplary, but the shares are real.We are four friends who wanted to invest. We talked to a real estate agent to find us options. He came up with a portion that is currently under construction. The builder agreed to sell it to us in 4 million.

Each of us (4 friends) invested 1 million to buy that portion with the agreement that each of us will get 20% from the resale profit and the estate agent will take 20% of profit on the services that he provided to us in the following; buying the portion, seeing through all documentation and reselling once the construction is completed.

(Please note that this has not happened yet) Lets say the portion sells for 5 million. We get 1 million profit. Each of us, investors and the agent, will get 200,000 other than what we invested.

Please tell:

1. Is the above transactions Shariah Compliant?

2. If not, what should we do now?

3. Would I (one of the investors) need to pay zakat on this 1 million investment while keeping in view my previous query that I have done this investment to go for a larger flat due to my growing needs?


In the Name of Allah, the Most Gracious, the Most Merciful.

As-salāmu ‘alaykum wa-rahmatullāhi wa-barakātuh.

There are two aspects to the investment scheme.

a)     Purchasing a floor of building

b)    Reselling the floor of the building.

It is not permissible to purchase a floor of a building before being built or while being built. A fundamental principle of purchase and sale is the commodity must be present.1 In the case of constructing a floor of the building, the building is not existing or it is incomplete. It is not permissible to conclude a transaction of purchase and sale in that condition.

The alternative is to hire the builder to build. In this case, the builder will be a contractor rather than a seller and the contract will be governed by the laws of Ijarah(hiring)or Istisna(manufacturing/ building 2

The second issue is selling the floors. The proposal made in the query is suitable. The agent will be hired for his services and paid 20% of the profits.

And Allah Ta’āla Knows Best

Huzaifah Deedat

Student Darul Iftaa
Lusaka, Zambia 

Checked and Approved by,
Mufti Ebrahim Desai.


العناية شرح الهداية- دار الفكر (6/ 409)1

 بيع ما لا يملكه البائع فلا يجوز

الاختيار لتعليل المختار- مطبعة الحلبي (2/ 51)2

قَالَ: (وَلَا بُدَّ مِنْ كَوْنِ الْمَنَافِعِ وَالْأُجْرَةِ مَعْلُومَةً) قَطْعًا لِلْمُنَازَعَةِ وَلِمَا تَقَدَّمَ مِنَ الْحَدِيثِ.

الفتاوى الهندية – ط. دار الفكر (4/ 411)

أما شرائط الصحة فمنها رضا المتعاقدين ومنها أن يكون المعقود عليه وهو المنفعة معلوما علما يمنع المنازعة فإن كان مجهولا جهالة مفضية إلى المنازعة يمنع صحة العقد وإلا فلا ومنها بيان محل المنفعة حتى لو قال آجرتك إحدى هاتين الدارين أو أحد هذين العبدين أو استأجرت أحد هذين الصانعين لم يصح العقد ومنها بيان المدة في الدور والمنازل والحوانيت وفي استئجار الظئر وأما بيان ما يستأجر له في إجارة المنازل فليس بشرط حتى لو استأجر شيئا من ذلك ولم يسم ما يعمل فيه جاز وأما في إجارة الأرض فلا بد من بيان ما يستأجر له


This answer was collected from Askimam.org, which is operated under the supervision of Mufti Ebrahim Desai from South Africa.

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