Investing in off-plan properties in Dubai offers an exciting opportunity for individuals seeking to secure their future in the thriving real estate market. However, it’s essential to understand the rights of cancellation that both investors and property developers have in this process.
In this article, we will explore the existing off-plan laws in Dubai and shed light on the various scenarios based on the percentage of project completion.
Understanding the Off-Plan Laws in Dubai
Dubai, being a progressive city, has implemented off-plan laws to protect the interests of both investors and property developers. In 2017, His Highness Sheikh Mohammed Bin Rashid Al Maktoum introduced law No:19 on the Interim Real Estate Register in Dubai.
This law grants the Dubai Land Department (DLD) and property developers the right to terminate an off-plan sales contract without court interference. However, it’s important to note that this law may not apply if there are private contractual agreements with the property developer.
Cancellation Procedures Based on Project Completion
When investing in off-plan properties in Dubai, it’s essential to be familiar with the cancellation procedures that depend on the project’s completion stage. The rights of cancellation are determined by specific guidelines, ensuring fairness and protection for both investors and property developers.
Let’s explore the different scenarios based on the percentage of project completion and the corresponding procedures that come into play.
Construction Not Started
In cases where construction has not commenced due to unknown reasons, the developer has the right to retain 30% of the amounts paid by the buyer. However, the remaining funds must be returned to the buyer within 60 days after the termination of the Sales and Purchase Agreement (SPA).
Completion Below 60%
If the project completion is below 60%, the developer can retain 25% of the amounts paid by the buyer and must return the excess amount. The buyer’s money should be refunded within one year of the SPA termination or within 60 days of the property’s resale.
Completion Between 60% to 80%
For projects with completion ranging between 60% and 80%, the developer has the right to keep 40% of the amount paid by the buyer and return the remaining sum. The same conditions apply as in the case of completion below 60%.
Completion Exceeding 80%
When the project nears completion, cancellation becomes a more complex process. At this stage, the developer may choose to declare the SPA and request the buyer’s execution.
Alternatively, the DLD may sell the property through a public auction, with any gains offsetting an unpaid balance in favor of the developer. Furthermore, the developer can unilaterally terminate the SPA, retaining 40% of the purchase price.
Refunds and RERA Resolution
In the event of project cancellation by the Real Estate Regulation Agency (RERA), the developer is obliged to refund all amounts paid by the buyer in accordance with Law No:8 of 2007, regarding Escrow Accounts for Real Estate Development in Dubai.
These regulations ensure that investors are protected and their investments are safeguarded.
Introducing Asette: Streamlining Off-Plan Property Investments in Dubai
Investing in off-plan properties in Dubai presents a promising opportunity for individuals looking to capitalize on the thriving real estate market. However, navigating the intricacies of this process requires a deep understanding of the rights of cancellation and the procedures involved, regulated by the Real Estate Regulatory Agency.
At Asette, we recognize the complexities associated with off-plan property investments and are dedicated to simplifying the entire investment journey. Our mission is to provide you with the necessary support and knowledge to make informed decisions and ensure a smooth and transparent purchasing process.
With Asette, you gain access to a cutting-edge platform that empowers you to create a personalized investment profile, explore a wide range of property investment options, and analyze crucial market metrics to evaluate potential performance and profitability.
We believe in equipping you with the tools and insights needed to make confident investment decisions in the dynamic Dubai real estate market.
By leveraging Asette’s comprehensive resources and expertise, you can streamline your off-plan property investments, mitigate risks, and seize lucrative opportunities. Our commitment to transparency, customer satisfaction, and a hassle-free experience sets us apart as your trusted partner in the Dubai real estate landscape.
Embark on your journey towards successful off-plan property investments in Dubai with Asette. Experience the difference of a platform designed to simplify the investment process and provide you with the necessary support for transparent decision-making!