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Developers in Dubai who promise much and fail to deliver will have no place to hide any longer. Nor can they set service fees promising a certain level of quality on the common areas and then come up short during the project phase.
The Real Estate Regulatory Agency (Rera) will have in-house teams doing spot checks at on-going real estate projects in the city. Their mandate includes ensuring that the build specifications of the buildings match international norms.
At the site visits, Rera's specialists will do all of the required evaluations related to the quality of work deployed in these projects. All visits will be done before the owners and tenants move into the properties.
"The control programme will help us to ensure that the developers commit to finishing building requirements and will rid any excesses that may appear in new projects," said Mohammad Khalifa Bin Hammad, Senior Director of Real Estate Regulatory Relations Department. ''Our initiative does not only aim to impose control on the quality of facilities, but also makes sure that developers claim fees imposed on existing services in those projects, which in turn preserves the rights of investors and reduces the problems that may arise during the completion stage of the buildings."
According to market sources, the latest moves by the regulatory authority upgrades the concept of investor rights in Dubai real estate. By monitoring quality control during the build phase, investors will not have to suddenly confront major quality problems on handover.
''So often in the past, developers have during the project phase cut down on common area facilities to keep their costs down or when hit by project delays,'' said an industry source. ''Buyers are probably the last ones to know about these changes, which creates a bad name for the entire industry.
''The new Rera regulations are not just about setting a minimum build standards platform – it goes much further than that. Each developer who promises a certain set of features will now have to deliver on those.''
It is learnt that the field teams have already started their project runs. They will have their work cut out with an estimated 30,000-40,000 homes to be delivered in the next 12-24 months. Developers who were thinking of cutting corners will now have to ditch all such plans or be answerable to Rera.
Market sources say this is another step towards creating a balance between what a developer promises and what an investor gets to have on delivery. It also removes the impression that the regulatory and inspection regime is heavily tilted in the developers' favour. It levels the playing field for all stakeholders.
As the Rera statement says, "These efforts are being carried out with a view to placing Dubai at the forefront of global real estate markets for attracting investment."
Rera has in the recent past issued guidelines related to assigning a star rating system for buildings in Dubai. And a few days ago, it brought out strict regulations on how developers and brokers can market and sell properties in the emirate.
With the field trip announcement, investor rights in Dubai's real estate gets entrenched on the centre-stage.
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Source: Manoj Nair, Associate Editor, gulfnews.com