Friday, January 18, 2008

Good news for home owners

One of many areas where the laws are playing catch-up with the frantic growth of Dubai is the real estate sector. The new property laws which are gradually coming into place are clarifying the situation and will remove some of the less acceptable practices.

The question of maintenance fees has been a major cause of friction between owners and developers for a long time, with outrageous fees being charged. Arrogant responses along the lines of 'if you don't like it you can sell your property' have been reported.

The registered owners of the properties have been the developers, who also took responsibility for maintenance - and fixed the charges. According to a report in Gulf News the charges have been between Dh8 and Dh12 a square foot. In fact much higher figures have been reported by disgruntled owners.

It's been a nice little earner for the developers. Just work it out - let's say at even only Dh10 a square foot, with 100 apartments of an average 1,500 sq.ft. in a block. That's one and a half million dirhams a year, a large part of which would be profit I'm sure.

Now with individual owners being registered with the Land Department and the new Condominium Law coming into play that will change.

Owners Associations backed by the law will take over responsibility for maintenance of the properties. The association will appoint a maintenance company, which obviously means there will be competition for the contracts, which should lead to sensible charges. The annual fee will be agreed by the owners themselves through their association.

It's taken a long time but at last we're getting to where we should be.


LDU said...

Is there anything similar to a First Home Owner Grant in Dubai?

Seabee said...

LDU, no. There isn't in most countries - it was introduced in Oz as a vote-buying exercise and because house prices had gone so high that young people trying to buy their first homes simply couldn't afford to.

Seabee said...

LDU, I should add that the government is building housing for Emiratis. I think the figure announced recently was 40,000 new homes.