Investors in Dubai will pay only 30% service charge

RERA is looking for new ways to increase a return on real estate investments in Dubai by cutting down all possible expenditures for investors.

Dubai authorities are going to meet all potential investors’ needs. Despite the fact that Dubai has one of the world’s highest rates of return on investment in real estate averaging to about 7% at the moment, emirate's authorities are looking for ways to increase it.

Dubai’s Real Estate Regulatory Agency (RERA) wants the biggest part of service charges to be paid by developers themselves. “My advice to developers is to allocate some of the built-up area for revenue generation. Start with 50 per cent of the service charge going up to 70 per cent of the service charge to be covered from this asset and not from the investor. Hence, the investor will be paying only 30 per cent,” the chief of RERA, Marwan bin Ghalita said on sidelines of the Dubai International Government Achievements Exhibition (DIGAE 2016).

“They should look at allocating one complete floor towards service charge which could be for five to 10 years, depending on the developer. This is what I am encouraging developers to do,” he asserted.

Many local developers are ready to cut down service charges for their clients even now. In February already mentioned about the Damac’s initiative to offer a discount on service chargers for property owners in its developments.

According to the latest official data from RERA, the Dubai’s property investors’ market activity is growing: about 100-120 real estate transactions are registered each day. “In 2008, we were concerned about the crisis, but now we are not. We are confident that all the developers will complete their projects. So far, we have enough guarantees to ensure that protects are completed.”

To protect investors, the Dubai government has taken a number of important measures. Now, before getting the project started, the developer must pay 100% of the land cost, as well as a minimum of 20% of the whole cost required for construction, while another 10% must be ensured by a general contractor.

Dubai housing market showed all signs of revival in the first quarter of 2016. While 2015 saw only 48 new projects launched in Dubai throughout a year, now the emirate’s having 38 new construction projects launched in just few months of the first quarter 2016. 11,537 investors of 127 different nationalities invested about AED 55 billion in Dubai’s real estate during the period, according to the Land Department.

However, despite the obvious benefits of the property buying in the UAE, sometimes it can get hard to manage all the intricacies of real estate transactions abroad. That’s why IMEX Real Estate offers its legal services for sale and lease property transactions, as well as property management services. We will take care of all the troubles associated with renting, leasing and selling your property. And now IMEX Real Estate also provides off-plan units handover services. If you can’t be personally present at the time your home is handed over, we will do it for you and we guarantee that all issues (if any), will be solved. With IMEX Real Estate your investment in Dubai’s real estate will be safe!

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