Rush to real estate authority in Dubai as a last resort, homeowners told
Homeowner need to raise issue with property management firms before taking it to regulator
Dubai: Homeowners in Dubai have been delivered a message by Real Estate Regulatory Agency (RERA): as much as possible, settle all differences on any issue related to their property at the level of the owners association (OA) itself.
And come to RERA office only as a last resort. This is the gist of an update on the JOP (jointly owned property) Law that RERA issued on Saturday.
According to market sources, the regulatory agency has been, in recent weeks, flooded with demands/requests to intervene in disputes related to service charges, their collection, removal of OA management firms, “forensic audits” of past use of funds collected as service fees, and a lot more. Property owners, or their representatives, had been approaching RERA directly to voice their concerns.
But now, RERA says, the complaint from the homeowner should first be addressed to the OA management company in writing before it can be passed on to the government agency.
Only RERA has the power to remove and appoint a replacement management entity. And this power only arises if RERA deems the management entity to be incompetent, unqualified, or unable to manage and maintain the common parts
The OA company should respond to the filing of the complaint within a maximum of two working days. If this is not done - or the response is deemed inappropriate – it can be filed formally with RERA through the Dubai REST app.
“Owners will be able to obtain this service quickly, comfortably, and remotely at any time,” said Mohammed Khalifa bin Hammad, Senior Director of the Real Estate Relations Regulatory Department at RERA.
“The impact of this measure will not be limited to individual owners… but will enhance the attractiveness of the real estate market in terms of guaranteeing the rights of everyone.”
According to Shahram Safai, Partner at the law firm of Afridi & Angell, the latest update from RERA is consistent with the revised JOP Law, which was issued late last year.
Setting up the complaint
To get on Dubai REST app, homeowners will need to attach a set of documents related to the complaint, including a copy of the written complaint sent earlier and a copy of the official response (if any).
The complainant will also need to provide any other documents that support the complaint filed against the OA company.
One point of difference
It is the mention of the two working days that is the most striking aspect of the update. In doing so, RERA has effectively brought down the number of days before it gets involved in a dispute.
The original law on this score provides for 14 days. This is the relevant portion:
As per Article 24(4), “An owners committee shall exclusively receive and notify to the management entity, the complaints and suggestions submitted by owners and occupants in respect of the management, operation, maintenance, and repair of common parts.
“And submit these complaints and suggestions to RERA if the management entity fails to address them within 14 days from the date of being notified of the same.”
After introducing the complaints service related to the management of JOPs through Dubai REST, owners will be able to obtain this service quickly and remotely at any time
A difficult first-half
Relations between owner associations and OA management firms had been deteriorating in the recent past, and escalated after the pandemic struck and started hitting on the incomes of property owners.
Forensic audit
At some residential towers, home owners are insisting that RERA should give clearance to conduct “forensic audits” on how OA management firms have been using the funds collected in recent years.
According to an owner of a property in Jumeirah Village Circle, “The JOP Law has given the owners committee the right to review, investigate and monitor the management company’s work - including review the service charge figures before submitting it to RERA.
“We want to exercise those rights as per the Law. For too long, there have been many instances where OA management companies have not offered the needed transparency in explaining the costs. This has been repeated across years, and we need RERA to bring such practices to an end.”
Gradual steps
Safai, however, counsels patience. “Our understanding is that there have been a number of complaints lodged through the Dubai Land Department’s REST app,” he said. “However, we are not aware of RERA formally removing and appointing a replacement management entity.
“In our view, this is not surprising as we are in the midst of a pandemic. And in addition, the six-month transitional period for the new JOP Law to take effect only expired in May.”
RERA’s move to make
Industry sources say trying to settle differences between homeowners and OA companies on their own will prove insurmountable. This is why RERA will be called in more frequently to try and patch together a compromise.
But for now, the Dubai REST app will be put through a lot of work.