My husband and I signed a contract with a developer to purchase an apartment that is under construction. We have paid 70 per cent of the purchase price. The property is 60 per cent complete. Unfortunately, my husband was made redundant recently. If he does not find new employment soon, we will be unable to pay the next instalment. What happens in that case?
You can try to work out an alternative payment plan with the developer prior to defaulting on the sales and purchase agreement (SPA). If you do default, most developers will make several attempts to contact you to resolve the issue. If unsuccessful, per the Dubai off-plan law, the developer must notify the DLD of the default. The DLD is then required to give you a 30-day notice to give you a chance to fulfil your obligations. If you cannot pay within that time frame, the developer’s rights depend on the construction milestone reached in the project. Since the developer has completed 60 per cent of the construction, the developer may terminate the SPA and retain a maximum of 40 per cent of the purchase price. The remaining 30 percent you have paid will be refunded to you. Once the SPA is terminated, the DLD will deregister the property from Oqood (interim register) and reregister it in the developer’s name. At this point, developers typically resell the property to another buyer. This practice has been successfully challenged in at least one recent Dubai Courts case, so you may want to consult with a law firm regarding your rights.
What is the difference between the primary and secondary market?
In Dubai, the primary market includes property being sold off-plan (under construction) by the developer. The secondary market is for ready (completed) property. Off-plan sales are governed by a separate set of laws, setting out the rights and obligations of both the developer and the buyer, as well as the establishment of escrow accounts for sales proceeds.
I found a property I want to purchase, but the broker is acting suspiciously and is not providing much information about the seller. How do I know this is not a scam?
Sometimes brokers are hesitant to share the property owner’s information for fear that the buyer will approach the owner directly and cut the broker out of the deal. To protect yourself, there are several steps you should take. First, confirm that the broker is licensed by the Real Estate Regulatory Agency. You can do this on the Dubai Land Department (DLD) website (www.dubailand.gov.ae) or the Dubai Brokers app on your mobile device. Next, ask the broker to verify ownership of the property in your presence. This can be completed on the DLD website or Dubai Brokers app, by entering the ownership certificate details or scanning the document’s QR code. This will confirm whether the deed is valid or invalid. At this point, if you are still uncomfortable, it may be best to walk away from the transaction. If you do decide to move forward, be sure to make all deposits and other payments by cheque and never with cash.
My landlord sent me a 12-month eviction notice from the Notary Public for personal use of the apartment. It is three months into the notice period, and I received a call from an agent asking me to allow a viewing for the sale of the property. Can the landlord change her mind about the reason for eviction?
Both personal use and sale of the property are legal grounds for eviction. However, when the landlord issues an eviction notice, the purpose of the eviction must be the same grounds upon which the tenant is actually evicted. If the landlord has now decided to sell the property instead of using it personally, a new 12-month notice should be served.
