Wednesday, July 09, 2008

Is Dubai a trusworthy place to invest?

It looks as though Dubai's reputation is about to take another hit as a trustworthy place to invest.

If you set rules for investors, take their money then change the rules after a period of time you deserve all the criticism and withdrawal of investments that will follow.

You'll also deserve the loss of business from potential investors who won't want to take the risk of putting their money into a place that doesn't deliver what was promised.

Dubai can't afford that. The future depends entirely on business investment, which means investors being able to have confidence in the transparency, the honesty, of the place. Investors have to be able to trust that what you say is truthful.

The latest problem about to hit the news is the residence visa linked to property ownership story.

When freehold for foreigners was announced it included the offer of a residence visa, if the normal Immigration requirements were met by the buyer.

The arrangement was for the three Master Developers to be able to sponsor buyers of any property in their master developments. This was agreed between Immigration and the three developers - which means an agreement between government entities. Only the three Master Developers had this arrangement, not any of the hundreds of smaller developers who build on the master developments. All buyers who wished to apply for a residence visa would have to apply to and through the Master Developer.

That's fair enough and it's what has happened since freehold property has been sold here.

Now it seems the rules are being changed.

Last month we had reports that RERA had sent a proposal to government to replace the residence visas with short-term visit visas.

Now I've been contacted by someone who has run into a brick wall trying to get his residence visa.

He bought an apartment in Dubai Marina on the basis that Emaar, the Master Developer of the marina, would sponsor him for a residence visa. Without it he can't even get DEWA and Etisalat services connected.

But when he contacted Emaar he was referred back to his individual developer. He got the usual Dubai runaround, different stories from different people at the developer and at Emaar.

Finally some clarity. He sent me a copy of an e-mail his developer sent him.

"...Emaar...confirmed that they have stop issuing visa at the moment. Because Government Department (the Emigration Department in Dubai &Lands Department) with Emaar are Discussing some changes in the process.

Meanwhile, we can only issue the ownership certificate."

So he's paid his money, the Title Deed will be issued, but he can't apply for a residence visa.

It's an absolute disgrace. Outrageous unprofessional business conduct. Dishonest.


dubaibilly said...

Sadly, it is not unexpected either.

rosh said...

My folks bought a home in AJ - just because they didn't want to rent anymore (plus given crazy rent increases). Having lived in UAE for so long, they really didn't buy into a residence visa possibility via property ownership. I mean for God's sake, people who've built the nation thru the decades, have their own businesses - or those born in the UAE, aren't allowed to belong - why would property investors, many of who moved in the last few years expect different? Or perhaps am being pessimistic, however, kinda calling it the way I've seen it, since birth.

That said, I agree with what you are saying. It's all true. It's time for this nation to grow up and change for the better.

Seabee said...

Rosh, people like your folks who've been here many years - and I know a lot of such people - might want to spend their retirement here too. After all, it's been their home for so long and, as you say, they've been part of building the nation. When they retire they don't have an employer to sponsor them so the only way they can stay is - or perhaps was - to buy a property and so get their residence visa. That's also showing commitment to the country by investing in its future.

Grumpy Goat said...

And this, ladies and gentlemen, is precisely the sort of thing that stops Beloved Wife and me from buying property here!

alexander... said...

Interesting, no? We were at a pal's house a few months ago at a 'do' which hosted about 40 people, all of them 'long timers' who'd been living here for 15 years and more.

Not one is buying. Figure.

SingleGuyInDubai said...

Very true, but at last who is going to answer and be accountable??

Anonymous said...

I was born in this country, I respect it so much, it took me while my country couldn't give me a proper living and this I will never forget, but there is no way I will ever buy property here, I will keep on renting even if rents go higher.