Dubai’s Real Estate Regulatory Authority (RERA) recently stated that off-plan investors cannot impose extra costs on investors after sale. This statement is issued following news in the media that Dubai-based developer “ACW Holdings” was demanding extra costs on handover. In some cases, the cost of the properties the investors had agreed to buy increased by more than 50 percent.
It has been reported that the Sale Purchase Agreement concluded between ACW Holdings and some investors included the following clause: “If the floor area is increased by more than 3 percent the seller shall be entitled to increase the purchase price in accordance with the size increase. The purchaser acknowledges and agrees that all plans, specifications and finishes are subject to the above variations and the purchaser will have no claim against the seller for any such variations”.
As per the real estate Law, clause 2 of Article 13 of Executive Council Resolution No (6) of 2010 approving the Executive Regulation of Law No (13) of 2008 concerning the Regulation of the interim real estate register in the Emirate of Dubai provides that: “Any area in excess of the net area of the sold Real Property Unit may not be taken into consideration. Unless agreed otherwise, the developer may not claim the value of such extra area.”
Thanks to RERA’s mediation, investors dealing with ACW Holdings will not have to pay any additional costs before handover of their properties.