Article in Arabian Business
Article in Arabian Business. Finally someone in the UAE is writing about this mess, even in a very "gentle " manner.
http://www.arabianbusiness.com/buyers-in-stalled-ajman-real-estate-seek-...
Buyers in Ajman’s stalled $15bn Emirates City projects may face a prolonged legal battle to secure a refund on their investments, the city’s real estate watchdog has warned.
More than a dozen projects in the Emirates City and Emirates Lake Towers developments are on hold, according to the Ajman Real Estate Regulatory Authority’s (ARRA) website.
But scores of apartment buyers seeking refunds on their downpayments have found themselves at sea as their offplan projects pre-date Ajman’s tightened real estate laws.
Developers that launched sales before 2008 were not obliged to secure funds in an escrow account, meaning ARRA has no means of helping buyers tracing their missing funds.
The most we can do is have them file a complaint and then we can try to get the developer to make the best offer possible [for the property],” said Nabel Al Ameen, spokesperson for ARRA.
Investors will have to seek legal action against developers to secure a refund, he added.
Hundreds of investors have been affected. One online forum, emiratescity.org, claims to have more than 2,855 members. Some 30 percent have paid between AED 110,000 and AED150,000 in downpayments to developments, a site poll shows.
One investor, who spoke on condition of anonymity, said she had paid hundreds of thousands of dirhams to Dubai-based Sapphire Properties for an apartment in the Sapphire Lake View project, but was unable to find out what had happened to her funds.
According to ARRA’s website, the development has been suspended.
“Basically, they didn’t actually inform [us],” she told Arabian Business.
“They weren’t answering any phones, anything basically. I had to keep calling and trying to find a way to see what was going on. There was nobody answering their phones and I had given up around 40 percent [of the property value].”
Contact details listed on Sapphire Properties’ website were unavailable.
Buyers in Boulevard Ajman, a stalled project in the emirate, have been offered the chance to switch their uncompleted units with finished properties in Dubai and Ajman, ARRA’s Al Ameen said. Buyers posting on the Emirates City forum, however, said contracts remained opaque.
Investors who hold out for the delivery of their original properties in Emirates City may find there are significant changes to the masterplan, warned Matthew Green, head of research and analysis at CB Richard Ellis.
“From my knowledge, there were substantial revisions to the master plan and obviously that was going to be an issue for potential investors,” he said.
“I think it might have included the removal of some of the lake areas and such. I think the main issues we’re hearing about are relating to the residential elements that have been sold off to investors. There are obviously a number of residential towers there which are either not moving ahead or got to certain stages of construction and are now looking to hold.”