Real estate laws still require reform
Emirate’s real estate standards debated by panel, including RER A CEO Marwan Bin Ghulaita
New regulations aimed at restoring confidence in Dubai’s real estate markets still require reform.
Speaking at a discussion panel hosted by Dubai School of Government last month, Ludmila Yamalove, managing partner with real estate lawyer HPL Yamalove & Plewka, said that in order for confidence to be restored, Dubai’s courts must stop overruling federal law in real estate disputes.
“From a legal perspective, the federal law is fairly comprehensive and most of the laws we are familiar with in western jurisdictions exist in UAE law.
“But the Dubai courts only use Dubai laws and forget or ignore the federal laws and that is where we find things quite frustrating.”
The comments were made in response to Real Estate Regulatory Authority (RERA) CEO Marwan Bin Ghulaita, who said new regulations will attract “professionals” to Dubai’s market, establishing the emirate’s reputation as a real estate investment destination
Calling the market “the most transparent in the region”, Ghulaita added there was a strong need for professionals, innovation, information, infrastructure and education.
“Let me share with you one fact; we are stringent on introducing any company which will come and serve the owners. That is why we are making sure that only professionals, up to our standards, will come to Dubai,” Ghulaita said, pledging to found the reformed industry on international standards. Three or four years back the regulation was not there; the number one priority for investors in 2006 and 2007 was a huge return.
The banks will start lending but we will have every lender in Dubai working by the book, not like before”
“Today, number one is regulation. People did get hurt in Dubai but they will reinvest in Dubai because this is the right time to; not in 2006. The banks will start lending but we will have every lender in Dubai working by the book, not like before,” Ghulaita added.
Furthermore, on the sidelines of the meeting Bin Galaita told reporters that the Real Estate Regulatory Authority was launching a new website for investors to check the status of their project including the technical report and details of homeowners associations.
In May 2010, RERA said Dubai’s developers had six months to hand control to home owners associations following the Land Department’s guidelines of the strata law. Once registered the associations would be given control over the maintenance of their units, service levels and costs and control over service fees.
“Owners associations [registered with RERA] will now have to manage the service charges. Earlier the developers managed it. Service charges might go up as the owners associations will have to bear all costs,” said Neil.
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As many as 150 home owners associations (IOAs) have been registered with the Real Estate Regulatory Agency (RERA), Galaita revealed at the conference.
Landmark Group CEO Charles Neil told members at a recent Dubai Property Society that 2000 homeowners associations would have to be formed based on the number of developments.
