2024 Guide to Dubai’s New Laws for Unfinished and Cancelled Real Estate Projects
Investing in off-plan properties in Dubai has long been an attractive option due to their potential for appreciation. However, delays or cancellations can sometimes hinder the expected returns. To safeguard investors, the UAE government has established detailed laws for handling unfinished or cancelled projects. Here’s a comprehensive look at these new laws.
New Laws for Cancelled Projects in Dubai
In 2020, His Highness Sheikh Mohammed Bin Rashid Al Maktoum issued Decree No. 33 of 2020 to address issues with cancelled or unfinished projects in Dubai. The decree followed an earlier law from 2013, where a special tribunal was created to oversee liquidation and resolve disputes related to these projects.
The amended law, Decree No. 33 of 2020, officially named the tribunal “The Special Tribunal for Liquidation of Cancelled Real Estate Projects in Dubai and Settlement of Related Rights.” The tribunal’s key roles include:
- Resolving pending disputes from previously unfinished or cancelled projects.
- Protecting investors by liquidating assets and distributing the returns to affected buyers.
It’s important to note that cases involving these projects cannot be filed in any other Dubai courts, as the special tribunal has exclusive jurisdiction. All decisions are enforced by the Execution Court at Dubai Courts.
New Rules for Unfinished Projects in Dubai
Developers must now comply with Dubai’s new law for unfinished real estate projects. This tribunal handles complaints from unfinished or suspended projects and defines investors’ rights, including asset liquidation. Investors affected by such projects will be compensated according to the tribunal’s findings.
Amendment Regarding the Interim Real Property Register
An important amendment to the law pertains to the Interim Real Estate Register. If a developer is unable to start a project, they are required to refund all amounts paid by the purchasers. The same rule applies to projects cancelled by the Real Estate Regulatory Agency (RERA).
Frequently Asked Questions
- What happens when a project is cancelled in Dubai?
The tribunal takes over to manage the liquidation process, which includes evaluating the project’s financial standing and reallocating funds.
- Do investors get their money back after a project is cancelled?
Yes. Developers are required to return funds to investors within 60 days of the cancellation decision.
- How can I request a refund after project cancellation?
Submit a petition to the Dubai Land Department (DLD), providing proof of payment and a signed Sale and Purchase Agreement (SPA). The DLD will then set a hearing date to initiate the refund process.
- Are there risks in purchasing off-plan properties in Dubai?
While off-plan properties offer attractive deals, risks such as project delays or changes in market conditions exist.
- How can I handle a delayed property handover?
Ensure your payments are up to date, visit the site regularly, and explore legal options if necessary.
Dubai’s real estate regulations continue to evolve to protect both investors and developers, ensuring a stable and transparent market. International investors should also be mindful of the foreign property ownership rules in the UAE before making any purchases.