Dubai homeowners urged to come forward for OA registration

RERA chief said few owner associations are formally registered

Dubai’s real estate watchdog is calling for more home owners to come forward in order to formally register their interim owners’ associations (IOAs).

The hold up in registering hundreds of IOAs in the emirate stems from difficulties bringing homeowners together for a compulsory meeting, RERA has said.

“[In order to get registered] they have to call for a general assembly meeting, and the majority [of the homeowners] should be there,” Marwan bin Ghalaita, CEO of RERA told Arabian Business on the sidelines of a Dubai conference.

“Sometimes the developer themselves own some of the property, so they would also need to be there. But it is very difficult to call all the owners into a meeting. It’s up to them. We are ready.”

Under strata law, a developer must hold a meeting known as the First Annual General Assembly in order to register a building’s OA with the emirate’s land department.  For the registration to be approved, it must be passed by at least two thirds of the building’s owners.

Once registered, OAs are entitled to manage the maintenance budgets and contracts of their properties.

Approximately 400 home owners associations have now obtained interim status, Ghalaita said, but are still waiting to become formally registered entities who can oversee their building’s upkeep.

Without registration, OAs have no legal standing, meaning they are unable to open a bank account, pay bills or hire contractors to oversee building maintenance.

Lawyers say the lack of registration is leaving home owners and developers in legal limbo, sparking rows over service fees and a decline in building maintenance quality.

In projects such as Nakheel’s Discovery Gardens and the Palm Jumeirah, default rates on service charges among homeowners are estimated to be as high as 50 percent.

“It’s a no-man’s land,” Brent Baldwin, an associate at Dubai’s Hadef & Partners told Arabian Business previously.

“Some developers want to get out and they’re trying to leave the owners to it. But [until registered] owners don’t have the legal status to do it so they need the developer to be involved.”

Nick Clayson, a partner at the Dubai branch of law firm Norton Rose, said it is in everyone’s interest to get owners associations registered as quickly as possible.

“Many buildings have not yet registered an OA or completed the formalities for creating the OA, so developers who have provided services and complied with their obligations may find difficulties in recovering the necessary service fees.

“Additionally many developers consider that they are owed outstanding service fees for the period prior to the promulgation of the Strata Laws.”

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Posted by: Charles Rosenbaum

I am an Owners Association Manager. My experience has been that if the control and responsibility of the bank account and funds is moved from the developer and is under the Interim Owners Association Board that the registration of the association can be quicker. For faster registration of associations RERA can look at approving of Interim Association bank accounts under certain cirumstances.

If all the steps for registration are complied with I feel confident that RERA will be more than willing to approve of the registration.

Posted by: Salvador

So far the bottleneck for the registration IS "RERA". They delayed everything on purpose and now they are calling people to come forward? Why RERA does not register the 400 IOA's identified to start with? Rera has lost credibility with all the none sense distributed via the press.

Posted by: Charles Rosenbaum

I can understand feeling frustrated with all of the delays that have occured. I am an Owners Assocition Manager and have seen both sides of the issue.

We are working, with the help of RERA, to resolve the issues that are invloved with the registration and feel confident that we moving as quickly as possible toward that end.

If we can be assistance to you don't hesitate to contact us.

Posted by: Chris

We have been trying to obtain Owner status, having been registered as an Interim association for over 2.5 years, and still RERA move the goal posts.

Posted by: Omar

Absentee landlords that own more than one property, who initially purchased the property to "flip it" are the problem. They are just looking to sell the property as soon as they can and are not interested in the management of the development.

I have attended two such meetings to form interim HOA's and in each case the attendance was under 20 owners out of a potential in excess of 400. I think the rules need to be changed such that the requirement for two thirds of the owners to approve the board membership be dropped to say one third. Otherwise, there an HOA will never be formed.

Posted by: Sarah

Mr,Marwan Please look into Dubai Lagoon / Schon project ..We have paid so many payments and still no contruction !

All comments are subject to approval before appearing

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