FalconZ Articles

The Real Estate Regulatory Agency (Rera) has assured investors and buyers in the market that the recently
announced Law No 13 “Regulating Initial Property Registration in Dubai” will not see buyers selling rampantly
to avoid the off-plan registration fee.

Speaking to Emirates Business, Mohammed Sultan Al Thani, Assistant Director-General of the Dubai Land Department said: “Developers today are making a return-on-investment (RoI) in the average of 10 to 15 percent. Why would they want to sell their property just to avoid the one per cent off-plan registration fee?”
“There has been a lot of talk on the real estate market in Dubai, rest assured, Rera’s intentions is only to stabilise market conditions and set a good framework in place,” he said.

The new law is currently in draft form; it is yet to be published in the Official Gazette.

Dubai-based law firms DLA Piper Middle East and Clyde & Co confirmed the draft for Law No 13 does not
restrict property re-sale and whether a property could be ‘flipped’ remains subject to the terms of the sales
contract and the consent and payment of any fees to the developer.

“The new draft says that developers may no longer charge transfer fees on off-plan sales. Developers will be
allowed to charge an ‘administration fee’, which is pre-approved by the Land Department. We understand the
administration fee will be no more than Dh5,000 however this is yet to be announced or confirmed by the
Dubai Land Department,” said Tom O’Grady, Partner, Head of Real Estate, DLA Piper Middle East.

Dubai Land Department’s Thani further said under the pre-registration law, if a buyer breaches an off-plan
sales contract with a developer, under the new law the onus will be on the developer to advise Rera of the
breach. Rera will then issue a notice to the buyer granting a 30-day grace period for the buyer to comply with its contractual obligations (or rectify its breach). If the breach is not rectified within the 30-day period, the developer may terminate the contract and return 70 per cent of the money paid by the buyer.