Dubai: Residents of some high-profile towers in Dubai are not being allowed to receive deliveries at their doors, after developers and their owners-association (OA) management companies cut off the service due to non-payment of service charges.
At a time when more residents are ordering in their food and groceries, this action by developers/OA companies are proving to be more than just a nuisance to be endured.
Property owners initially assumed that the denial of delivery to their doorsteps had to do with COVID-19 safety guidelines by OA management companies. But then, they found that some of neighbours didn’t seem to have any such issue with deliveries.
“No notices were issued by the developer or OA company,” said a homeowner at one such firm. “Such actions were taken arbitrarily, and whoever got affected voiced their concerns to security as well as the property manager.
“That’s when they were told non-payment of service charges was the cause and that these restrictions would continue.”
Anyone who ordered in would then have to go down to collect from the delivery person. Even tenants are affected by the developer/OA company’s move, because their landlords may not have paid the service charges and that would put them at the mercy of the new diktats.
“To best of my knowledge, this issue has been going on for a couple of months and it’s escalating,” said a homeowner. “More so after RERA (Real Estate Regulatory Authority) issued a notice to property owners in Dubai to be up to date on their service charge payments for this year.
“But that still doesn’t explain how OA management companies can start dictating terms to homeowners. As per the Law, OA firms are appointed by homeowners – and yet there are still instances of developers calling the shots.”
The relationship between homeowners and OA companies have been testy at the best of times. But since the start of the year, it’s starting to get downright messy, with homeowners insisting they be given the rights to change property service companies and also decide what their service charges should be.
RERA, in April, had issued a statement that service charges in Dubai will be brought down. They had also waived the penalties related to 2019 service charge payments.
Even then, homeowners are expecting some more relief on service charges, especially after the fallout caused by the COVID-19, with the rental market hit by job losses and drop in income levels.
This, more than anything, has led to the drop in service charge collections this year, market sources say.
“The OA management companies continue to send notices threatening legal action and additional penalties for payment delays on service charges,” said one homeowner. “There is no disclosure of penalties in the legal notices - but it is mentioned that any cost associated with legal action will also be added to the customer’s account.”
Win RERA's support
For now, feedback from homeowners is that they will continue to press RERA for a review of some of agreements with OA management companies. The biggest complaint relates to how some of these entities are still too closely associated with the developers, or even directly owned by them.
The law – the recently updated JOP (Jointly Owned Property) regulation – does give homeowners such a flexibility. Now, they are trying to get the updated clauses to make the changes happen.
But until then, homeowners who delay paying their service charges will find that deliveries are not reaching their doorstep. And that they do have to head down to collect their order.
It’s a question who ends up blinking first – the homeowner or the OA company.
“The issue escalated when the property management company could not explain how owners should be compensated if they are already paying to the service provider,” said one property owner. “The OAE companies maintain that the additional amount was taken is to ensure any shortfall and will be returned the following year.
“But the owners still haven’t seen any such reversal even after the fourth-quarter invoice was raised last October. There have been no reconciliation of such charges in the current statements until now.”