Time for time sharing?

To keep pace with the rapid growth in the Dubai property market, legislative processes are evolving quickly in order to regulate and modify local land and property ownership.

Considering the kind and amount of construction built with tourists and holidaymakers in mind, one wants to think beyond the titles of freehold, leasehold and commonhold propertie. Instead, there is room for innovative new concepts to creep in and strengthen the already booming tourism industry. One such concept is that of ‘time share' that has been pioneered in the Gulf region.

Also known as holiday ownership, timeshare is a mechanism that allows individuals or group to purchase a holiday property like a villa, resort or a condo for an annual duration of a week or so, and use it for a specific number of years. Since the overall cost of the property is divided among all the ‘owners', higher quality amenities and upkeep become more affordable. In a more technical sense, time sharing has been the fourth dimension in property ownership.

Time-share finds its place more in a commercial arena rather than legal. The acquisition of legal interest or title by the time-share holder depends on the legal vehicle used for the time-share scheme. Some of the implementation methods used are based on sound legal principles. They include: Joint Ownership - joint ownership of units in commonhold property, also known as a Strata Land Title or a Sectional Title Scheme; Share Block Scheme - ownership of a block of shares in a company granting the shareholder a personal right to occupy a particular part of the building owned or leased by the company; Intermittent lease, Club method - a members' club which itself owns property and runs the scheme through trustees or guaranteed company.

By taking advantage of this method of ownership, tourists have the opportunity to move around and experience the beauty of Dubai with a light pocket: Though he may not be able to afford an apartment in the Palms, he may still be able to own a portion of the property for a week or a month. Some can even transfer to other properties within Dubai.

United Arab Emirates's Federal Law caters for the principle of time-share largely on the basis of joint ownership. The Economic Activities issued by the Dubai Department of Economic Development lists ‘Brokers of Renting Residential Units on Time-Sharing Basis' as a trade licence activity, which suggests commercial recognition more akin to the ‘intermittent lease' method.

There are many advantages of time sharing, among them: reduced costs, provision of a hedge against inflation and the ability to sell or transfer the deeds. But where there are advantages, disadvantages come along too. A problem currently associated with time share is the illegal selling and reselling of properties.

The laws governing time share are still being established but with them shall come more regulations and terms and conditions of time share operations in Dubai.

With the onslaught of attractions making Dubai a more appealing place for holiday-makers, the concept of time sharing turns a farfetched dream into a profitable reality for many more people.

Dr. Khalid Al Mehairi is a Managing Partner & Attorney at Law for Emirates Advocates in Dubai.

Print | Email | Discuss this article |

READERS' COMMENTS

View all comments (0)

Have your say

Click here to post a comment

Add your Comment All posts are sent to the administrator for review and are published only after approval. ArabianBusiness.com reserves the right to remove any comment at any time for any reason. Please keep your responses appropriate and on topic.
Name *
Remember me on this computer
Email *	(Your email address will not be published)
City
Country
Subject *
Comment *
Notify me of further comments
Security Code *
Please click post only once - your comment will not be published immediately.

MORE FROM ARABIANBUSINESS.COM