Business | Property
Ban on speculation will stabilise market
The decision to ban speculation in the off-plan realty market is a vital and positive step that will contribute to the stability of Dubai real estate market and boost its growth, said a senior industry official.
- Staff Report
- Published: 23:28 August 24, 2008
Dubai: The decision to ban speculation in the off-plan realty market is a vital and positive step that will contribute to the stability of Dubai real estate market and boost its growth, said a senior industry official.
The new regulation is the foundation of the Dubai Land and Property Department (DLP) and the Real Estate Regulatory Authority (Rera), which feel this move will control escalating real estate prices.
Marzooq Al Rashdan, vice-chairman and managing director of Abyaar, said: "The new regulations list a number of provisions that need to be met by property buyers who plan to re-sell their properties.
"Being one of the leading boutique property developers, Abyaar believes that speculative buying may harm the real estate market, by pushing prices up to unrealistic highs. This has the ability to lead to a "real estate recession", therefore laws that regulate the property trading process are in the interest of all the parties involved in this sector".
Limiting increases
"We believe that the main purpose of this decision is to regulate all processes related to selling, buying and investing in Dubai properties, as well as attempt to control and limit increases in property prices."
Al Rashdan praised the Real Estate Development Trust Accounts law, which requires all developers to open trust accounts in which the amounts received from off-plan units buyers are deposited, and not used until the project is finalised.
Al Rashdan also stressed that this law, once approved, will support the growth and development of Dubai's real estate market, as it is set to improve property conditions.
Investor confidence
He noted that the move to approve new regulations and deal with exceptional cases that affect the real estate market will help boost dealers and investors' confidence, which will be reflected positively on the growth of the market.
The law comes in line with Abyaar's strategy and vision, based on the launch of unit sales when construction works have already commenced, or after the project is completed. The VentiQuattro launched by Abyaar recently the first tower in Dubai to be sold ready-for-residency.
Founded in 2005, Abyaar Real Estate Development is a joint venture between Kuwait's Aayan Leasing and Investment Company and Al Rashdan Group.
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