Dubai: The stakes are being further raised against speculative buying and selling of off-plan property in Dubai. Now, developers are not giving the green signal to those off-plan purchases where the investor has paid up to 50 per cent of the property cost, say industry sources.
“We have received feedback from some affected off-plan buyers to this effect in the last fortnight or so,” said Robin Teh, country manager at the property services firm Chesterton International. “These buyers had paid 50 or more of the value and as such there is nothing to prevent them from selling.
“But the concerned developer declined to issue a no-objection certificate for the deal to go ahead; we are trying to ascertain whether this applies to an individual developer or others are also doing it.”
Gulf News contacted developers that had recently rolled out off-plan projects to extremely enthusiastic responses from investors, mostly cash-ready buyers, as to their stand on allowing secondary sales of these. While declining to go into the specifics of each deal, a senior official at a leading developer said: “We are constantly monitoring market changes and will stay in step with them.
“All sales and purchase agreements related to the recent off-plan sales have stringent conditions for buyers.”
According to Teh: “There is no official directive from the Dubai Land Department that developers should not be allowing off-plan sales once the 50 per cent instalment mark is reached. So, it could be that the concerned developer might be taking its own initiative in this regard.
“By end of the first quarter, some of the other off-plan developments launched recently would have reached the 50 per cent payment mark. It will then be known whether more developers will have a similar approach.
“For developers, issuing of NoCs generates income and for them to forego an opportunity says much.”
Just recently, Emaar had issued a directive that put a halt to real estate agents booking off-plan properties at launch and then trying to sell the same at a premium to their own clients.
There had also been active speculation in the industry all through December 2013 that registration fees could be hiked again from the current 4 per cent — but the authorities were quick to issue statements that no such plan existed.
For their part, Dubai’s realty regulators too are clamping down on the local market getting carried away by hype and unsustainable expectations.
The instances of the latter are many, with the owner of a one-bedroom unit in JLT jacking up his asking price by more than Dh100,000 to Dh1.3 million early last week. He wasn’t the only one hoping there are ready buyers willing to pay a super-premium to get their hands on a ready property in Dubai right now.
“With property prices rising by 40 per cent last year alone and memories of [the downturn] four years back still fresh in everyone’s mind, caution [on the authorities’ part] is understandable,” said Chandrakant Whabi, CEO of Acrohouse Properties. “Further, there are concerns about recent launches and properties under construction currently flooding the market with huge supply over the next two years, with not enough end-users to buy them.”
