Abu Dhabi: A new real-estate law to regulate Abu Dhabi's fast-growing property sector is ready and should be released and enforced "very soon," a municipality official said yesterday.
"It's on government review now and I hope very soon it will be out," Ahmad Sharif, undersecretary of Abu Dhabi's department of municipal affairs (DMA), said in an interview at the Cityscape conference.
"We as the DMA are ready. We've had feedback from the developers and the government sectors who are involved, and it's on final review," Sharif said.
Framework
The law — which will regulate five areas of the property sector — aims to fill "gaps in our regulatory framework," he added. The law governs strata regulation, escrow accounts, mortgages, off-plan properties and brokerages.
The strata law will govern unit registration, which a current registration law doesn't address, while the escrow law will make mandatory an escrow account for each development. "Each project has to have an account and a developer cannot misuse that," Sharif said.
Sharif also said that the municipality will "transition" into ending the long-standing practice of allowing residential villas to be used for office space, as more commercial units come online and fill an under supply in that segment.
"If the building is designed for residential [use], it has to be used for residential," he said. "It will be transitioned, there is a time for it."
Abu Dhabi is moving quickly to ramp-up regulation of its property sector, after property prices have since slumped by as much as 35 per cent in Abu Dhabi and 50 per cent in neighbouring Dubai.
In a keynote speech on Sunday, Al Sharif said Abu Dhabi was looking for real-estate partners "who understand the need to help us shape and enforce a regulatory framework... that helps residents, investors, consumers and the wider world have confidence in what Abu Dhabi does when it undertakes the rapid expansion that comes with an enhanced economic position."
Abu Dhabi also sits on the world's sixth-largest crude reserves. It's spending an estimated $100 billion on real-estate and infrastructure development, as it builds industries and tries to attract investments to build an economy less reliant on oil exports.
