Delayed handover of off-plan property is one such situation where no buyer wants to be in. Though most of the off-plan property developers claim to complete the project within the given timeline, unexpected delays often occur in handover. There can be a situation when all the documents of your property are signed and sealed but not handed over to you on time. This is why you must learn how to tackle such situations to avoid further delays.
Delayed handover of off-plan property is a real thing and you must learn how to tackle the situation, if in case it happens. Today, we will explore how to handle delayed off-plan property handover by following the given steps.
STEPS TO HANDLE DELAYED HANDOVER OF OFF-PLAN PROPERTY
CHECK RELEVANT FEE AND/OR PAPERWORK ARE NOT PENDING
The first and most necessary step is to assure that you have paid all the dues for your off-plan property. You must also double-check that all the paperwork is completed. Most of the time, the primary reason for handover delay of off-plan property is usually pending payment or paperwork that you might have missed by the handover date.
VISIT THE SITE AND CHECK PROJECT STATUS
Inspect the status of the project. For this purpose, you must visit the project site to examine the physical state and meet with the project developer if you can. Talk to the off-plan property developer and ask about the actual date of the project’s completion. Moreover, you can also visit the Dubai Land Department (DLD) website to find the progress status and estimated completion date for all registered off-plan properties in Dubai.
FIND A SOLUTION WITH THE DEVELOPER
The best way to resolve an issue is by discussion and coming to a feasible solution to it. Speak to your project developer and see what can work in favour of both parties. The available solutions differ with individual projects and their developers, choose the one that’s most suitable for you.
You must also check the contract document or the Sales and Purchase Agreement (SPA). The two usually have a clause that states what happens when there is a situation of delayed handover of off-plan property. Most of the agreements signed in Dubai have a separate clause tackling this issue so make sure you are aware of what it says before negotiating with the off-plan property developers.
CHECK IF THE PROJECT IS CANCELLED BY RERA DUBAI
The Real Estate Regulation Authority (RERA) Dubai has the right to cancel any off-plan project, given any particular reason as per their stated rules. Hence, the delayed off plan property handover could be due to possible cancellation by RERA Dubai. Also, check out RERA rules for delayed projects. The project might have been cancelled due to many reasons that may include its planning or re-planning.
You can check if any of the off-plan property projects are cancelled by RERA on the Dubai Land Department (DLD) website and inquire about the “Project Status.” If the project has been cancelled, it will be transferred to the liquidation committee. After this, Dubai Real Estate Court will then tackle the matters of liquidation and settlement of rights to the purchasers in the case of delayed off plan property handover.
SEEK LEGAL ASSISTANCE & FILE A CASE
When you are unable to get any favourable solution by negotiations, you can file a case against the developer for compensation or end the contract. However, before seeking a legal help, you should be wary of a few important points, listed as under:
- According to the Sales and Purchase Agreement (SPA), project developers are usually allowed a grace period of one year from the date of handover. You can pursue legal action after the grace period comes to an end.
- You must contact the Dubai Real Estate Court to hire a property lawyer for handling delayed off-plan property handover.
- Filing a case, you can apply for compensation due to delay as per the conditions and clauses in your contract. You can claim the deposit and interest that you have paid to the off-plan property developer. Also, other additional charges that you have paid.
- You can ask for termination of the contract with the developer, given the conditions stated in the contract and be compensated for the amount paid.
Filing a case and seeking legal assistance should be the last option when you encounter a delayed handover of off-plan property.
HOW TO PREVENT ISSUES OF DELAYED HANDOVER OF OFF-PLAN PROPERTY AHEAD OF TIME
None of us would want to face unwanted and unpredictable delays in off-plan property handover in Dubai. Besides hampering our activity, it takes a toll on the peace of our minds. Therefore, investors and buyers should take a few measures that could limit the chances of any delays. Let us look at some of the important ones in detail.
CROSS-CHECK OFF-PLAN PROJECT DEVELOPERS
For a successful off-plan property investment in Dubai, it is necessary that you first research the off-plan property developers and the project. A good practice would be to find out how timely the developer has completed past off-plan projects (if any) and handed them over as per the communicated period. Visit the site and talk to other investors about the off-plan property you are interested in to gather relevant details. Remember your off-plan property purchase should be from a trusted developer.
ESCROW ACCOUNT REGISTERED WITH DLD
Make sure that the real estate developer has an Escrow account. Having an Escrow account is mandatory according to Law (8) of 2007. This law states that all real estate developers selling off-plan properties should have an Escrow account registered with DLD. The investors must deposit all the payments in the respective Escrow account.
One way to ensure that the off-plan property developers have an Escrow account is to visit DLD’s website and search for their project. If it appears on the website, you can be assured that they have an Escrow account registered with DLD.
PROJECT REGISTERED WITH RERA
It is mandatory to check whether the off-plan project in Dubai you are investing in and its developer is registered with the Real Estate Regulation Authority (RERA) Dubai. You may also visit the DLD website to see if both are registered with RERA.
DEVELOPER HAS RELEVANT PERMITS
Again, ensure your project developer has all relevant permits and approvals from DLD before they proceed with the promotion and sale of the off-plan property.
PAYMENT FEASIBILITY
Some developers offer payment incentives against building milestones or post-handover payments. It is recommended to choose among them for your investment.
READ THE CONTRACT CAREFULLY BEFORE SIGNING
Conclusively, the most important bit is to read your contract before signing it. Go through the clause section of the SPA and ensure if there are certain provisions that could assist in dealing with delayed handover of off-plan property.
It could be a best practice if you prepare a checklist before buying an off-plan property in Dubai.
FREQUENTLY ASKED QUESTIONS
WHAT IS DUBAI LAND DEPARTMENT (DLD)?
Founded in 1960, Dubai Land Department (DLD) is a government agency, responsible to supervise the transaction of the real estate industry in the city. It works on behalf of the Dubai Government, go through the detailed guide on Dubai Land Department (DLD) to explore more about it.
WHAT ARE THE ADVANTAGES OF BUYING AN OFF-PLAN PROPERTY?
There are many advantages of buying an off-plan property such as lower up-front costs, lowest purchase price point, brand-new property, and you can sell it before the completion time. Besides, there are many factors to consider as to why you should invest in an off-plan property.
With the information provided above, we hope you will be able to tackle and resolve cases of delayed handovers of off-plan property in Dubai. If you can take steps to safeguard your investment, it is highly unlikely that you will have to face the ordeal. Even if you do, now you know what to do about it. Also, you can prepare off-plan property handover checklist prior to investing and confirm with the developer.
There are many off-plan properties for sale in the Emirate, but if you want a property for a personal residence, you can choose to buy an apartment in Dubai or a villa. Besides, if you are looking for investment options, you can buy a ready property and rent it out. Also, don’t worry about the risks, there are several ways to minimise property investment risk in Dubai. Make sure to follow those.
Stay tuned to the popular property blog of the UAE for updates on property buying, selling and renting rules across all the Emirates.
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