Real Estate Developers in Abu Dhabi

Buying off-plan properties allows you to save 10-30% compared to buying a finished home, but it always involves risks. Now the authorities of Dubai and Abu Dhabi strictly regulate the activities of developers, so investors are protected. In the event of a stalled project, developers will not become defrauded equity holders and will be able to return the invested funds to buyers. Maximum security is ensured for property buyers in Dubai, where the relevant legislation is highly developed. Off-plan projects in this emirate are closely monitored by the Real Estate Regulatory Agency (RERA), a special division of the Dubai Land Department (DLD).

In Abu Dhabi, the Department of Municipal Affairs (DMA) is now performing similar functions. Until 2015, there were serious gaps in the legislation of the UAE capital regarding the sale of off-plan developments and protecting the interests of investors. For example, some of the projects that were implemented in Abu Dhabi in 2007-2008 were either never completed or were delivered with a delay of several years. But with the adoption of Law No. 3 of 2015 on the regulation of the real estate sector in Abu Dhabi, the situation has changed drastically. The new law clearly sets out the conditions for developers, including the provision of a development plan, obtaining a building permit from the DMA, as well as the mandatory opening of escrow accounts, similar to Dubai. Investors' funds are credited to these accounts, and the developer gains access to them only upon entering a certain stage of construction.

However, even despite all government measures to protect investors, certain risks still remain. These include the following probable situations:

• The project will be built with a significant delay or will become stalled. According to the propertyfinder.ae portal, more than half of developments launched in the UAE since 2008 were completed at least a year later than the announced deadline. Delivery of real estate on time is especially important for those who rent residential properties: extension of construction for at least a few months automatically means additional rental costs. In turn, those who buy real estate off-plan for subsequent lease, lose the profit that they could have received if the construction was completed on time. The same applies to canceled projects; your investment will be returned to you, but you will lose valuable time and energy.
• Lower quality of the finished property than originally stated. For example, the interior design or the provided amenities may not match the information previously mentioned in the brochure. It is also possible that the property area will be slightly smaller than promised by the developer.
  

The best way to protect yourself from these risks is to choose the right developer. As a rule, reliable companies, who want to expand their business further, value their reputation. They understand that their image on the market directly depends on the timing of the project and on the quality of the completed development, which means a surge in sales which then results in profit.