Property investors in Dubai adopting a more cautious approach post global crisis

More real estate buyers are seeking legal advice before investing in property in Dubai because of increasing concerns over security, it is claimed.
The global crisis has resulted in a more cautious approach in Dubai where many investors watched property values fall by up to 50% and led to an increasing number of disputes, according to agents.
Clients have serious concerns over the security of their real estate investments. Further, increase in number of real estate disputes is a result of many prospective buyers seeking legal advice prior to making a transaction,’ said Mohanad Alwadiya, managing director of Harbor Real Estate.

‘This was not the case in previous years which also contributed greatly to the problems that clients were facing as proper due diligence was not conducted prior to the sale and purchase of property,’ he added.

Real Estate Regulatory Agency (Rera) recently proposed a free legal advice service for buyers and sellers. This is expected to boost confidence levels in the real estate industry.

Elsewhere in the Gulf region new rules are being considered to make the real estate industry more transparent and secure.

For example, in Qatar a new law is currently being drawn up to regulate real estate agencies and property developers. Individuals freelancing as property brokers and companies not licensed to carry out real estate transactions will be taken to task once the new legislation comes into force.

The aim is to set up an association of real estate agents which would additionally help to regulate the property market and rid it of illegal and dodgy operators. It will also help with valuations.

Officials said the new rules are needed and confirmed there has an increasing number of cases of fraud committed by firms doubling as property brokers.