The Property Law Thread

[Tractor]

http://uk.biz.yahoo.com/13042006/323...t-revenue.html

[Krazy]

Foreign ownership law to boost Dubai property market
Wissam Keyrouz
AFP

DUBAI, United Arab Emirates -- A recent law legitimizing property ownership by foreigners in Dubai is expected to boost the real estate market in the booming Gulf city state, experts say.

"The new law is liable to enhance confidence in the legal framework protecting property buyers," said Abdel Salam Al Bessis, who runs estate agencies in Dubai and in Europe.

The legislation will "attract more big international property developers, who prefer to invest in countries that have clear-cut rules in this sector", he said.

A law passed in mid-March allowed foreigners, who hitherto bought indirectly through contracts with developers, to "become freehold property owners in areas designated by the ruler".

The legislation also authorizes foreigners, who make up more than 80 percent of Dubai's estimated 1.2 million population, to "derive benefit from their property or rent it out for a period not exceeding 99 years".

Property ownership was previously limited to citizens of the United Arab Emirates (UAE), of which Dubai is part, and other nationals of the Gulf Cooperation Council, which also includes Bahrain, Kuwait, Oman, Qatar and Saudi Arabia.

But another real estate expert who asked not to be named expressed doubt that large numbers of expatriates would buy homes in Dubai, which has rapidly turned into a regional business and leisure hub.

"I don't know if many people who want to buy a lifetime home in Dubai. They rather want to buy in order to sell afterwards," he said.

"Foreigners know that they will never become citizens of this country. I understand the government's reluctance [to naturalize foreign residents], but it means that Dubai, and the UAE in general, are not seen as a place where one would live and die," he said.

Buying property will make it easier for foreigners to get residence permits guaranteed by property developers, "but there are no guarantees in the long run", the source added.

A European investor who also asked not to be identified said that he bought two flats four years ago and sold them at a huge profit two months ago amid a sharp rise in real estate prices in Dubai.

"Many people fear that the bubble will burst because Dubai has been booming so quickly, even though all indications are that the growth is solid," he said.

Bessis said that any decline in Dubai's fortunes is likely to be manageable.

"Dubai will continue to grow, even though it will face competition ... especially from Abu Dhabi," he said.

Abu Dhabi, the largest and wealthiest of the seven emirates making up the UAE, accounts for the bulk of the Gulf country's oil production. It serves as capital and has recently launched big property projects open to foreign ownership for up to 99 years.

Dubai passed its new property law amid a steep hike in rent and purchase prices, which according to the real estate expert who wished to remain anonymous, is making foreign companies think twice before settling in the emirate.

Despite a construction frenzy, a shortage of supply has sent rent prices soaring by up to 50 percent.

Before the law was issued, foreigners who bought property in Dubai or one of the man-made islands emerging along its coast, received a deed from the major developing companies.

These are effectively owned and controlled by Dubai's government and its ruler, Sheikh Mohammed Bin Rashed Al Maktoum, and his family.

Mohammed Ali Al Abbar, chairman of real estate giant Emaar Properties that runs mega projects in Dubai, has described the legislation as "a real gain for the market and investors".

The massive projects underway "would have hit serious problems if the issue of freehold ownership had not been resolved", he said.

[Krazy]

Freehold clusters soon

http://www.gulfnews.com/nation/Housi.../10034175.html


Flurry of market activity expected as new property law comes into effect. Gulf News archive

Dubai: The government of Dubai is expected to announce several property clusters for expatriate ownership within weeks.

The announcement will come in the wake of the Property Registration Law (Law No. 7) issued by the government on March 13.

"The decision is expected very soon, within a few weeks' time, as we are in touch with the three master developers almost on a daily basis to iron out the details of registration," a senior official at the Dubai Land Department told Gulf News on Tuesday.

This will be a relief to the 13,000 homeowners who have already moved into their freehold homes without a registered title deed. Another 7,000 are waiting as new properties are prepared for handover by the end of this year.

The decision would clear any doubts and confusion among the owners and strengthen confidence among buyers.

"We are fully prepared to register the new properties, however, we can't do it without the new decision announcing the freehold areas," the official said

Dubai Courts and the Land Department are also in the process of creating an arbitration centre for the real estate sector.

Concerns

- Ownership of properties and visas are two separate issues, like other countries

- Criminal offenders may not benefit from property ownership

- The law is not very clear on the mortgage registration for freehold

- The will is likely to govern the inheritance, in case of a dispute

- The current law is not clear on the the 99-year leased properties, in case the building collapses.

[Krazy]

http://www.gulfnews.com/nation/Housi.../10034175.html

[Krazy]

'There is a lot of confusion'

Dubai: The new property law has not had a strong impact on the market yet, said officials.

"The law is not complete. There is room for confusion in the law," said Mohammad Nimer, director of MAG Group, a leading developer.

"We are waiting for the decree on the freehold places and the issuance of bylaws and addendum will be highly appreciated. The law did not add value to the market," he said.

"The law should be clearer for everyone to understand. I do not read anything from this."

Dubai's property community members say the bylaws could generate more confidence in the market.

"There has been heightened activity in the market, which is still strong. However, this is not due to the law," said Linda Mahoney, CEO of Betterhomes.

"The value of property appreciates when the buildings are nearing completion and depending on the location."

[Krazy]

Ready for Dubai's real estate frenzy?

Dubai: Frenetic activity is expected in Dubai's real estate market next week when the city's new property law is published in the Official Gazette, according to a top lawyer.

Any new law passed does not officially come into effect until is has been published in the gazette.

"Following the publication of the law in the Official Gazette, which should happen in a week's time, and the announcement of the freehold areas, we expect the three master developers Emaar, Nakheel and Dubai Properties to get permission from the Ruler's office to begin the registration process," Essam Al Tamimi, senior partner of Al Tamimi and Company, told Dubai's property officials at a breakfast meeting organised by the Dubai Property Group on Tuesday.

Dubai issued Law No 7 on March 13 that legalises freehold ownership of land and property to UAE and GCC nationals, while allowing the same rights to non-GCC expatriates to designated areas that will be announced by at a later stage.

"The new law, which comes into force on the date of its publication in the Official Gazette, has set out the basic legal foundations to match the progressive and increasingly dynamic property market in Dubai," Al Tamimi added.

He said the law is very brief in some areas and is not clear on some vital issues, such as mortgage registration, as well as common-hold use, which is very important for those who are buying apartments.

"The current law is not clear on the the responsibility of the land in the 99-year leased properties, in case the building collapses, or comes up for demolition before the expiry of 99-year lease, who retains the ownership of the land," he said.

It has left room for further enactment of bylaws on the Common Hold Registration as the current law specifies that a Single Title Deed will determine the ownership of a building co-owned by a number of apartment owners.

"Single Title Deed treats it as a 'Real Property Unit' with its own folio in the Property Register. Each individual apartment in the building is registered in its own sub-folio," he said.

Historic overview

- Ownership of land and property comes under the jurisdiction of the individual emirates. The Ruler of each emirate has been empowered by the UAE constitution to formulate and define the land and property law of that emirate.

- Historically, land ownership has remained with the governments and development of the land and property was restricted to UAE nationals only until recently.

- However, Sharjah is the first emirate to grant land and property ownership to GCC and Arab expatriates. Non-Arab expatriates are not included.

- Ajman allows expatriates (both GCC, Arab and non-Arab expatriates) to own land and property in certain industrial areas.

[Krazy]

Law reform essential to city's future

As the country opened up, economic and social reforms became a necessity. With the country's 80 per cent being expatriates, a large chunk of their income are repatriated outside the country, necessitating reforms.

Abu Dhabi, Ras Al Khaimah and Dubai has issued new property law for their respective emirates. Sharjah's existing law allows limited foreign ownership of properties, extended only to Arabs. The emirates of Umm Al Quwain, Ajman and Fujairah are expected to issue new property laws as some developers are offering freehold ownership to the expatriates already.

Buying in Dubai

* Among all the emirates, Dubai has revolutionised the freehold ownership of properties by extending freehold and leasehold ownership to everyone, including Arab and non-Arab expatriates in 2002. However, in the absence of a proper law, three master-developers - Emaar, Nakheel and various entities under Dubai Holding (Dubai Properties, Tecom, Dubailand, etc) - mandated by the government to offer freehold properties, continued to sell properties with freehold ownership.
* Accordingly, they began to sell villas and apartments to foreigners. A formal contract paper governs the terms of the deed, that is until recently backed by the government guarantees extended to the three developers. This had been the interim measures, until last month.
* More than 13,000 new homeowners have already moved to their freehold homes, and in the absence of the freehold law, the Purchase Contract between the developer and the buyer governed their ownership.
* Dubai government's promulgation of the property law will change that and legalise the ownership.
* The law says, the government will identify certain locations where expatriates will be allowed to own properties in their names, on (1) 99-year lease and (2) on freehold.
* The government is expected to issue new bylaws to regulate the market and determine the buying, selling procedures, fee structure and ensuring best practice.

[Krazy]

What are the grey areas?

Ownership of properties and visas are two separate issues, like other countries. Ownership of property does not automatically guarantee a visa. However, master developers are currently extending support in getting residence visas for owners.

Anyone with criminal record/offence and/or problems with law, will face consequences, regardless of whether s/he owns a property or not. Owning a property will not help if the court orders an individual deportation for offences.

The law is not very clear on the mortgage registration for freehold properties.

Inheritance: The will is likely to govern the inheritance. Expatriates have the right to object to this and seek the inheritance laws of his/her country of origin. Dubai's court will honour that.

Property buyers will require to go through arbitration before going to court in case of a dispute. However, Dubai Land Department is in the process of setting it up.

The current law is not clear on the the 99-year leased properties, in case the building collapses, or comes up for demolition before the expiry of 99-year lease, who retains the ownership of the land.

[Krazy]

How it will work

Step by step

1. Buyer chooses the villas/apartments.
2. Negotiates with the developer/broker on price and payment terms.
3. Signs a Purchase Contract wherein all the terms and conditions are supposed to be laid out, including payment structure, delivery date and fines in case of late payment by buyer or late delivery by developer.
4. The Purchase Contract remains as the most important document for the buyer that determines his/her ownership right, in the absence of the law, until recently.
5. The buyer can sell the property, through negotiations on pricing, through the developer, who transfers the ownership by issuing a new Purchase Contract for the new buyer following a satisfactory settlement between the two parties.
6. Under the current scenario, the individual market perception dictates the value of the property. No government authority determines the value of the surface property (villas/apartments).
7. In case of a dispute, home owners can directly approach the courts, without having to seek arbitration unless otherwise specified in the Purchase Contract.
8. All properties will be registered with Property Register at the Dubai Land Department, upon completion of the formalities and payment
of fees.
9. The homeowner will get registered Title Deed in their name, to be initially processed and handled by the master-developers - Nakheel, Emaar and Dubai Holding entities. Hence, a Land Department-registered Title Deed will be the base document for ownership.
10. Following this, the secondary purchase and sale will have to be conducted by the homeowners themselves.
11. Dubai Land Department will evaluate the land price/property value that will be the benchmark for both buyer/seller. It is developing and expanding its property evaluation unit, which till recently conducted land valuations only.
12. In case a dispute, the Land Department will arbitrate, before the case goes to the court. An arbitration centre is likely to be set up in due course.

[dubaiflo]

exactly what we need. they are working on it.

i spoke with the dubaiwaterfront sales agent regarding this and he said at the moment the new law is just hot air since nothing happened in fact.

they are still working on the details to make the registration possible.

interesting articles above.
seems like it will take some more months but then, finally, it will work like everyone wants.

[Salty]

Originally Posted by Krazy

How it will work


11. Dubai Land Department will evaluate the land price/property value that will be the benchmark for both buyer/seller. It is developing and expanding its property evaluation unit, which till recently conducted land valuations only.

The above is an important step IMO. Should help identify true values and stop wildly different prices being quoted for very similar properties in vitually identical locations.

[Krazy]

Property law only good in parts

A month ago Dubai issued Property Law No 7 allowing, for the first time in the history of the emirate, an expatriate to own property. After enforcement of the law, the registration will enable the owner to obtain a title deed against the property, use the property, lease it, resell it and bequeath it.

The law has filled a vacuum that was much needed in the market. But it is still vague and needs another by-law to explain its articles and set up a mechanism for implementation.

However, the law restricts ownership of property by expatriates in designated areas that are under the development of one of three public developers: Nakheel, Emaar and Dubai Properties, and their subsidiaries. It will be illegal for an expatriate to buy property outside the designated areas.

The new law fails to explain and identify the link between owning property and having a residence visa, and has left it to arrangements in the contract between developers and buyers of property. The right of residency issue should be clear and not have been left to speculation. Those who bought or are willing to buy a property in Dubai should have clear knowledge about sponsorship entitlements on purchasing their property, and when they could lose such a sponsorship.

Another major issue that must be addressed in the by-law to be issued by the Land Department concerning maintenance of apartments in tower buildings and villas in compounds developed by the three designated companies.

The law should make clear who has the responsibility of maintenance of towers and compounds and the responsibilities of owners, together with a mechanism for collecting maintenance fees and how these should be spent. The property law must address all the problems that resulted from the new industry, to avoid complications in future.

[Krazy]

Dubai property law likely to come into force next week

20 April 2006

DUBAI — The recently issued Dubai Property Law No. (7) of 2006 may come into force next week when it is published in the Official Gazette, said Essam Al-Tamimi, senior partner of Al-Tamimi & Company advocates and legal consultants.

"The law will come into force on the date of its publication in the Official Gazette and I expect this to be next week, or even maybe this," he said at the monthly networking event of the Dubai Property Group. This group has a 110-strong membership that represents the combined interests of the Dubai's real estate community. It is in the process of joining forces with the DCCI Property Group.

Al-Tamimi said: "For foreign property investors, we now just await the Ruler's approval of designated areas in Dubai where they are entitled to own property and then they can seek registration of their property titles at the Dubai Land Department. This is expected soon." For GCC nationals, the new law grants them the right to own property in any area of Dubai, giving them equal status to UAE nationals.

Since all titles will be issued by the Land Department, Al-Tamimi also said: "It is my understanding that another branch may be opening in new Dubai to help process all the data," he said. Registration is essential in order to acquire ownership. "My advice is to get in the queue because if it's not done you do not have ownership," he added. Those registering leases between 10 and 99 years should also line up. If a lease is less than 10 years it cannot be registered, he said. The Land Department would also be regulating real estate brokers.

Land registration fees are also likely to increase, commented Al-Tamimi. This is generally a two per cent fee based on the sale price on the date of purchase. "I understand a new fee structure is likely," he said, "and having lived in Dubai so long it is most likely to be up".

He also added that although the law provides for the appropriate legal framework "it is just a starting point and more regulation and legislation is required to meet the needs of a market that is rapidly growing in both size and complexity".

Al-Tamimi said: "The law is extremely brief, disappointingly so", pointing in particular to the fact that mortgages, and their enforcement, were not included, although this was because the issue of mortgages was included in the Civil Law. "I believe it could have been done in a better way," he said. "Mortgages are as important as the ownership of land".

During the discussion, Al-Tamimi also said that he believed that the issuance of visas had nothing to do with property law and asked: "Why are the two tied?" "I believe the government will accommodate the issue but I don't expect more than this."

[Krazy]

Some good news for investors? I hope so..

Property prices to rise further

Real estate prices in the country will rise by another 20 to 30 per cent in the next few months as investors from Asian and other countries will enter the real estate market, a leading builder and developer predicted.

“Fears of the real estate market getting saturated are unfounded,” said Hussain Sajwani, Chairman of Damac Properties, during the launch of his company’s Dh1.5 billion projects on the Al Raha and Al Reem Island developments in Abu Dhabi.

“Yes, the market is mature and has become competitive. In 2003, there was a downward trend but within nine months the prices shot by 20 to 30 per cent.” Dolphin Towers, a three-tower structure, including 400 condominiums and 10 sea-facing townhouses, will be located within the Al Raha beach development. Oceanscape, a mixeduse undertaking, including 184 apartments and eight townhouses, will be at Al Reem development, which will be completed within 18 months.

Sajwani said the rising cost of construction materials, labour and other factors will also influence the end products.

He predicted a strong growth in real estate for Abu Dhabi.

“With over 100 natural islands, a progressive and open investment policy, new property laws and the thrust on tourism, will give real estate in the capital a big boost,” he said.

Damac has signed a Memorandum of Understanding with Abu Dhabi Commercial Bank (ADCB) to provide mortgage financing to all customers.

“Under the terms ADCB will charge a competitive processing fee and interest rates and 90 per cent financing for a period of 25 years with buyers in both the projects paying Dh500 monthly instalments,” he explained.

Damac has also mortgage arrangements with Union National Bank on the properties on competitive rates.

[Krazy]

Registration of freehold property gets under way

Dubai: Dubai Land Department has started registration of freehold properties for non-GCC residents, a source told Gulf News.



A decree identifying Dubai's freehold zones has been officially approved and could be accepted as law by the end of the month. But according to the source, the process of issuing title deeds in individual names is in fact under way with many residents bearing official documents declaring the land in their name.

More than 13,000 families have already moved to their "freehold" homes since Dubai opened its property to expatriate ownership in 2002.

In March, Dubai issued Property Registration Law (No 7) that legalised freehold ownership of land and property to UAE and GCC nationals. According to Article (4) of the law, non-GCC citizens are able to purchase freehold property in areas determined and specified by the Ruler of Dubai.

Mohammad Sultan Thani, director of development and marketing administration at Dubai Land Department, said a decree identifying Dubai's freehold zones has been officially agreed by the Ruler's Office and is awaiting official publication.

He said developments built by major real estate companies such as Nakheel, Dubai Holding and Emaar will be included, and added, "We are not expecting any major omissions".

Although he could not confirm the exact date of publication, Thani said the decree was weeks, rather than months, away.

According to a leading Dubai developer, a discrepancy among buyers over the legal rights they expect and what is in fact the current reality is damaging the real estate sector.

"Every week and month that the law remains unclear it shakes the credibility of the market, said Mohammad Nimer, director of MAG Group.

Nadeem A Shaikh, manager of Better Homes' legal division, added: "Hopefully [the decree will be passed] very soon. The announcement would alleviate uncertainty for all those buyers who bought property in popular areas such as Emirates Hills and Dubai Marina on the reliance that these "zones" would eventually become freehold.

"Buyers currently believe they can register their property immediately and that the transfer fee they have already paid will cover this cost."

The Land Department is planning to set up a temporary office near Dubai's main residential developments to cope with the rush to register when the decree is passed, while a new premises is being built in Bur Dubai. The process is subject to charges from the Land Department.

[Krazy]

I hope that map is wrong coz JLT, emirates hills, springs/meadows and greens are not listed as a freehold zones!

[Krazy]

UAE property laws boost freehold and leasehold sales

15 July 2006

DUBAI — Freehold and leasehold property laws allowing non-GCC expatriates to own homes in various emirates have rejuvenated the real estate market, bringing to end the uncertainties about properties already bought or booked.

This in turn has paved the way for buyers to focus on the design and decoration of their homes.

For such buyers, the ideal opportunity comes in the form of Dubai Ideal Home Show (DIHS) that is scheduled to take place at the Airport Expo Dubai from November 30-December 3, 2006. Recent estimates suggest that real estate projects worth Dh165 billion ($45 billion) are currently under construction in emirate, with another Dh165 billion ($45 billion) in the development stages.

The GCC and the Middle East regions have witnessed sustained buyers interest including from internationally renowned professionals following the move by Dubai back in 2002 to allow freehold property for expatriates.

Major projects announced subsequently have seen most of the properties being bought by either investors or homeowners. "The cultural and ethnic mix of Dubai and the neighbouring regions offers businesses an opportunity to target their varied tastes at the Dubai Ideal Home Show," said Messe Frankfurt's Exhibitions Director, Christopher Hudson.

"In order to address all aspects of a home, the show will have individual zones including Interior Design, Kitchen to Table, Home Tech, Arts and Crafts, Garden & Landscaping, Property and Festive Zones," he added. For homeowners who have bought property recently or who are planning to do so in the future, the show can present innumerable choices to design and decorate their place of dwellings. The Dubai Ideal Home Show 2006 will have zones with special themes including Interior Design and Furniture Zone, Kitchen to Table Zone, Tech Zone, Arts & Crafts Zone, Garden Zone and Property Zone.

Recent trends indicate there has been a shift in the buying patterns with more buyers being homeowners than investors.

This has been facilitated by the recent updated Dubai property laws, several attractive mortgage financing offers and an increasing availability of quality properties.

The Dubai Ministry of Planning predicts that at the current rate of growth, Dubai's population will almost double by 2010 to more than two million people, and by 2017 up to four million.

In addition, the number of tourists visiting Dubai grew by almost 50 per cent from 2001 to 2004 to 5.4 million people, with Dubai government figures targeting 15 million visitors by 2010. DIHS is an ideal platform for the several segments in the industry including Interior Design, Kitchen to Table, Home Tech, Arts and Crafts, Garden & Landscaping, Property and Christmas Wonderland.

At last year's show there were more than 200 exhibitors and over 7,500 visitors who had a chance to choose and decide their home environment.
The attendance and participation this year is expected to be much higher following the coming together of the two leading publishing houses in the UAE.

[guy_in_dubai]

GN maps are usually wrong..like this one up there and i once saw a map showing arabian ranches next to jumeirah islands once :O

[dubaiflo]

Springs meadows and Greens are NOT missing.

[Krazy]

that's right.. only they are shown wrongly on the map..

still JLT is missing