Developers need to put 20% of project value in escrow

They must also verify ownership of the project and pay its value in full, says regulator

In response to recent media reports, the Dubai Land Department (DLD) has confirmed that developers only need to deposit 20 per cent of the project’s value in escrow ahead of launching off-plan sales. They also need to verify ownership of the project and pay its value in full, in addition to receiving all approvals from the competent authorities, according to a statement issued on Thursday.

Sources had told Khaleej Times on Tuesday that a proposal was being mulled which would force developers to launch off-plan sales only once construction had reached the 50 per cent mark. This was to reduce the pace of off-plan launches in Dubai.

But in the latest statement, there is no mention of any plan to raise the 20 per cent limit to 50 per cent as a requirement for developers to launch sales.

Sultan Butti bin Mejren, director-general of the DLD, said: “There is a strong coordination among all relevant government institutions, including the DLD, as well as between developers and various parties in the market to establish confidence among investors and achieve the highest degree of transparency in Dubai’s real estate market.”

The Land Department’s statement said 150 new projects were registered in Dubai during 2017, at a combined value of Dh82 billion and that 90 projects were completed during the period.

– deepthi@khaleejtimes.com

https://www.khaleejtimes.com/business/real-estate/projects-worth-dh82-billion-registered-in-dubai-in-2017

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