By Anil Bhoyrul
Dr Habib Al Mulla criticises the UAE's real estate watchdog over lack of legislation
Top UAE lawyer Dr Habib Al Mulla has accused real estate watchdog RERA of dragging its heels on the formation of a real estate law in the country.
In an interview in Arabian Business, Al Mulla said: “In property there is no framework to protect the consumers. We need a proper strong real estate law in Dubai and in the UAE.
"Until now we have not seen anything tangible come out of RERA. I think they are well behind and they need to speed up.”
Al Mulla added he was concerned that no strong legal infrastructure had been put in place during the recent recession.
He added: “We have seen two phases. The phase of growth and the phase of slowdown. Unfortunately in both cases we have not dealt with the situation properly.
"During the boom no one cared to look at the legislation we have put in place and in slowdown people were concerned with other things. My fear is again we are seeing this level of growth and not enough attention is being paid to the legal infrastructure.”
Last year, indebted developer Nakheel sparked huge controversy after banning several tenant on the Palm Jumeriah from using its beaches. The developer claimed it was within its rights to do so over unpaid service fees – despite the fact that most of those banned were tenants who are not responsible for service fees.
At the time, UAE business legend Khalaf Al Habtoor told Arabian Business: “It was 100 percent [damaging] and unacceptable. If I am buying a house and using the beach and later told I have to pay for the beach, this is abnormal. This is damaging the reputation of my country.” Habtoor added:
“I am 100 percent sure that the higher authorities were not aware of such a thing because they would not have accepted it…. They would never have [agreed to] it but some people try to show they are making money for the government – they are damaging its reputation two million times [over] for a few dirhams.”
Al Mulla said Habtoor’s comments are “strong” but admits there are “concerns” – however, he says the wider issue needs to be examined, and is again a problem that needs to be laid at RERA’s door.
“There has been legal vacuum so developers have filled in the gaps with contractual arrangements. Because there was no legal framework these contractual arrangements were made, so maybe they (Nakheel) have been contractually right to do so. Now this is where RERA has to step in and say even though you have contractual rights, there are also consumer rights.”
When will Owners Associations finally be allowed to open bank accounts?
Shoreline apartments - RERA is not responding to the interim owners assocation in their request to be fully fledged. This has been going on for many, many months. New management company (AM) was chosen but Nakheel are forcing themselves as the AM because they say OA is not fully fledged. Seems to be all in favour of Nakheel. With regards to the beach, it is in the property contract of the owners that they have right to use the beach, pool, gym as communal property. Do RERA want to do anything - they certianly have been approached so, so many times!
Bravo Dr. Al Mulla! About time somebody stated the obvious.
Thanks to Dr Habib Al Mulla taking up this. Currently landlords or real estate companies are taking the customers for a ride and there is no protection or support for the customers. This starts from the Contract terms and conditions, rent changes, unresolved issues since years, security hazards (like no security measures at buildings, no CCTV camera, expired fire extinguishers, etc.).
It is high time to bring customer experience as a dimension to RERA framework.
Thanks to Dr Habib Al Mulla once again taking this up.
Another grey area are the various SPA's (Sales and Purchase Agreements). This is made by the Developers (Sellers) so obviously it is in their favour. The Purchaser, who attracted by the development and or payment plan has no other option, either sign or leave.
I believe the SPA should be RERA approved, before the Developers can advertise or launch their project. This would provide transparency and protect the rights of both parties.
Dr. Habib is absolutely spot on!
RERA under Marwan bin Ghaleitha has been all Pfaff and no substance.
Other than making grand pronouncements, it has not resolved 1 substantial issue.
Instead of behaving like a regulator and making policy guidelines it has behaved like a headless chicken going round and round and has failed to control errant developers.
Lets nail this article on the wall. Rarely there is criticism. Rera has done almost nothing and many thousands of investors lost billions.
well done Dr Habib Al Mulla for taking a stand! There is no proper law, anything goes. Consumers get stepped on everyday not just at the Palm but in JLT, JBR & Marina too.
When will Emaar register its home owners associations?