Monday, Dec 10, 2007

Gulf News

Dubai: Abu Dhabi is planning to create appropriate legal framework to protect property investors in the emirate to support the current property boom, senior government officials said on Sunday.

Speaking at an event, 'The Building Blocks - A Seminar on Abu Dhabi Property Laws,' in Abu Dhabi yesterday, Ahmad Mohammad Shareef, Undersecretary of the Department of Municipal Affairs (DMA) said: "Abu Dhabi is currently witnessing a construction boom which is predicted to continue into the next 15 years. The evidence of this can been seen in the recent launch of numerous development projects such as Reem Island, Al Raha Beach and Saadiyat Island.

"An essential element to the success of these mixed-use projects, however, is dependent on having the right regulatory framework that could provide legal protection and clarity that property owners and investors require."

Currently, the DMA in consultation with legal consultants Al Tamimi and CompanyTamimi and Company is drafting an "implementation regulations" which will provide guidance on several aspects of the property laws including the establishment and management of common ownership associations for multi-owned buildings and rules relating to the ownership, management, maintenance and operation of common property in such multi-owned buildings.

Property specialists and lawyers yesterday urged the Abu Dhabi government to set up a real estate regulatory body, which could operate in a similar way a Real Estate Regulatory Agency in Dubai (RERA) in regulating brokers and developers with specific laws and regulations.

Experts also urged the government to implement a property registration system in the emirate. "There is an urgent need to implement a land registration system in Abu Dhabi similar to other established jurisdictions in the world," said Mohammad Kamal, senior property lawyer with Al Tamimi & Company.

Analysts believe that Abu Dhabi's property valuations are still cheap and has further growth potential.

According to a recent report by HSBC, the Abu Dhabi property sector is gaining credibility.

"After a slow start to the year, sales activity has picked up in second half of 2007. The market remains extremely tight, with stronger-than-expected growth in rents (22 per cent) and prices (18 per cent)," said HSBC's real estate analysts Walid Khalfallah and Majed Azza.

Further enhancement of Abu Dhabi's current property laws in relation to the registration of property rights and ownership rights is expected to have a positive impact on the real estate market

In 2005, two laws were issued in relation to the ownership and registration of real property rights in Abu Dhabi.

Law No 3 of 2005 concerned the registration of real property in Abu Dhabi. Law No 19 of 2005 confirmed the ownership rights of UAE, GCC and foreign nationals in Abu Dhabi within designated areas known as 'Investment Zones'. However, the law does not give them the rights to the land upon which the building or apartment is located.

A Strata Law is expected to be implemented in Dubai soon and will define the rights of owners of units and common property in multi-owned buildings and communities.

By Babu Das Augustine

© Gulf News 2007. All rights reserved.