Ajman body to be set up to tackle real estate issues

Dubai: Ajman's Real Estate Regulatory Authority (Arra) will finalise the establishment of a legal committee including a property court in the next two months, to help settle disputes, a senior official told Gulf News.

The committee involves representatives from various departments at both the local and federal government level, said Omar Barghouthi, director-general of Arra.

"We are waiting to unify the final shape of the committee& It will look into disputes and will be similar to the real estate court in Dubai," Barghouthi said.

The off-plan market is big business in Ajman as it is an emerging emirate, with many projects involving building whole communities, such as Emirates City, Ajman Uptown, Awali City, Al Zorah and Humaid City.

Together, these projects have a combined value of over Dh250 billion. However, with the global financial downturn, many investors have become increasingly nervous about their off-plan investments as many projects still don't have escrow accounts in place.

Disputes have erupted between investors and developers regarding payment plans and construction progress.

To increase transparency and confidence in Ajman real estate, Arra instructed developers to register with the regulator and also their projects earlier this year.

Of all the projects under way in Ajman, 116 are registered with escrow accounts and 36 are not.

Those projects that are not registered include Chocolate Tower being developed by Al Andaleeb, Gold Crest Dreams A, B, C and D, developed by Star Giga Establishment and Smart Towers 2 to 8 developed by Gold Crest Properties.

Barghouthi said that the future of Chocolate Tower depends solely on its developer Al Andaleeb and whether they hand over the necessary documents.

"We are in touch with the developer to get him to present us with the documents we need. But we have stopped customers making payments until an escrow is open," Barghouthi said.

The real estate market in Ajman underwent a solid boom in 2006 to 2008, as it provided a cost-effective alternative to Dubai's properties that were going out of reach of the end-users due to speculation-driven unrealistic price hikes. However, with the sudden outflow of the speculative elements, the market suffered a steep decline, in recent months.