Law No. 9 Safeguard’s Dubai Property Sector

During this recession time, Dubai property sector is trying to come on the recovery path. During this tough situation the real estate investors are cancelling their contracts before completion, because of which Dubai government has issued law no. 9 in 2009. As global recession is prevailing, there is an acute shortage of liquidity in the property market, and thus property developers are not getting any new property contracts. RERA said, that despite of these contract cancellations there are some 30,000 units that are being made available in the year 2009 and in 2010, it will get increased to around 45,000 units.

This Law number 9 that has been issued in developers interest is basically got amended from Article 11 of Law number 13. Previously in article 11 the procedure that is to be abided by any property developer in the event of contract cancellation was mentioned, but the ruling being applicable was not mentioned in that article. Under this revised law number 9, the developer must notify the Land Department or RERA if any purchaser fails to make the installment payment for the property.

Once the notification is sent to the buyer, a written notice is being sent by the Land Department informing the purchaser about this breach, thus reminding him to rectify the fault within another 30 days, failing which the developer would cancel the contract. The most important fact regarding this law is if there are any other contracts or purchases associated with that particular contract, it will also get canceled. Moreover, a technical report from the site is a must to attach with the letter. A reference scale has been introduced for default purchasers as well.

With the emergence of this law both investors and buyers are being benefited as earlier no agency was there which could monitor these purchaser-developer transactions in Dubai.