By Neil Halligan
Real estate agents complain of unlicensed people becoming involved in property deals
Increased regulations in Dubai have meant that property speculation has become more difficult, according to Rera CEO.
Speaking during a real estate seminar at CityScape, Rera CEO Marwan Bin Ghalita said the Land Department has made a number of changes aimed at reducing the number of speculators, starting with increasing transaction fees from two percent to four percent.
“Then we started introducing a minimum payment of 40 percent from the developer. This is an element just to stop speculation,” he said.
Rera is now considering raising the payment to 50 percent before the first transaction.
“We are making sure that the people who are investing in any project are long term investors and not speculators like before,” he said.
“Also, the time of registration used to more than six months of the first sale; now the Land Department is giving them 60 days but making sure that they can register it within one week. If a developer launches a project, he must register the first sale within one week because the system is ready now. It’s not like before.
“All those measures I think is going to slow down the speculation, but it will not eliminate it because I still think you need a percentage of speculation in any project, but you don’t need it to be 60 percent or 70 percent. 20 percent or 15 percent is okay in some of the projects,” he added.
Ghalita said their various initiative have paid off in the “last six or seven months”, and help “to drive away speculators from a project”. He said high value projects, though, will always be susceptible to speculators.
“We can see the most speculation is happening with Emaar Properties because of the brand of Emaar. I think still Emaar could not reach the mass investor yet; there is still a shortlist where only those people can buy the first day. This is what we are noticing.
“The Emaar team, whenever we meet them, are working and making sure. They, as you know, launch the same time in Dubai, Saudi Arabia, Kuwait, UK, and other parts of the world, reaching a huge number of investors,” he added.
Ghalita said developers are helping to keep a control on speculation in the property market.
“I think speculation is being controlled now; it’s not like before. We will do much more if it’s needed because personally speaking I think the developers and the industry is doing much to drive away the speculators from the market,” he said.
What about the Dubai Lagoon Project By Schon Properties that was launched back in 2005 ...all we get is empty promises / lies from Schon developers I have bought 2 bedroom ( 2 units ) , paid over 900,000 aed payments (all on time ) How are you protecting off plan property buyers who bought back in 2005 Mr. Marwan ?
Insurance is probably the answer to protect the off plan property. I invested the UK and Dubai in 2007, both the projects never completed, I got my money refunded through insurance on UK but lost my investment in DUBAI!
Our money is being used to pay for the huge billboards on Sheikh Zayed Road for another project. We should be proud.
Dubai's real estate market has grown too fast and of course there were plenty of investors who lost their money, and some have made good premiums (those who were lucky to sell their real estate on time). And what DLD does now is just adjustment and precautions to save future investors from another downfall. There are always mistakes people learn from and unfortunately it was at cost of other ones. There is no investor with no loss.