Dubai – Dubai has announced changes to the responsibilities and framework of the Real Estate Regulatory Authority (RERA) and Dubai Land Department (DLD) to bring more stability and transparency as well as increase the sector’s contribution to the economy.
His Highness Sheikh Mohammed bin Rashid Al Maktoum, Vice-President and Prime Minister of the UAE and Ruler of Dubai, issued Law No. (4) of 2019 whereby the responsibilities related to the real estate rental contracts matters related to property owners and tenants will be shifted from RERA to DLD.
The new announcements are part of series of measures announced by Sheikh Mohammed earlier this month by forming a new committee under the Chairmanship of Sheikh Maktoum bin Mohammed bin Rashid Al Maktoum, Deputy Ruler of Dubai, to bring balance between supply and demand in the real estate market.
Under the new laws, the Chairman of The Executive Council of Dubai will appoint the CEO of RERA and will also issue the regulations and resolutions. RERA has been tasked regulating and overseeing escrow accounts; accrediting financial institutions that are qualified to manage real estate development escrow accounts; and approving regulations that govern development, brokerage and management of real estate including joint property.
The regulatory body will also ensure a secured environment for real estate projects, protect the rights of developers and investors, implementing new projects and programmes as well as promote professional and ethical standards in the industry.
Industry executives say this new regulations means RERA will take more proactive role in driving stability and transparency of the emirate’s real estate sector. The measures will also bring ease and clarity in day-to-day dealings with DLD and RERA in terms of ease of doing business for investors, property buyers and tenants.
The emirate’s real estate market is witnessing oversupply concerns with an estimated 47,500 units to be delivered in in 2019. Prices of villas and apartments fell four per cent in the second-quarter while rentals and sales are projected to fall by five per cent.
Farhad Azizi, CEO of Azizi Developments, said the restructuring of the legal provisions is a remarkably valuable move towards solving anticipated challenges in the sector and ensuring a promising and sustainable future, in line with Dubai Plan 2021.
“RERA will take an even more proactive role in driving stability, transparency and growth, taking the industry’s security and ethical standards to an even greater height. We applaud His Highness Sheikh Mohammed’s decision and will carefully study the law’s provisions to formulate our strategy and plans accordingly. We are deeply grateful and proud to be part of Dubai’s impressive growth trajectory, which is enabled by commendable, forward-thinking laws and policies such as these,” Azizi said.
Rizwan Sajan, Founder and Chairman of Danube Group, said the new laws are aimed at ensuring that everyone feels secured who has exposure to the local real estate market.
The law issued will help stabilise Dubai’s real estate industry and in turn will bolster its economy because the sector is one of the major drivers and key contributors here, Sajan said.
Moreover, RERA monitors real estate advertisements published in media; develops and launches awareness programmes in collaboration with the Dubai Real Estate Institute to educate the public about their rights and responsibilities; and prepares and updates policies designed to balance supply and demand.
Dounia Fadi, chief operating officer, Berkshire Hathaway HomeServices Gulf Properties, said transparency and improved legislation through RERA have absolutely played a huge role making the UAE and Dubai in particular a safe haven for investors.
“We are supportive of all regulations and regulatory frame work for it is fundamental for a healthy business environment, providing investors security and confidence in the real estate sector,” Fadi added.