As the Dubai property investment prices continue to decline due to the pandemic, many people have expressed their interest to buy one. They want to take advantage of this opportunity to secure a property while the prices are still affordable. The experts also see a rising trend in the demand since it’s selling like hotcakes. Before you buy a property, though, it’s important to consider the service charges accompanied by it.
Dubai Property Investment Service Charges You Need To Know
Despite the recent decline in Dubai property investment prices for the last couple of years, it’s the opposite when it comes to fees. According to experts, the service charges depend on the age of the building in a community. It can also affect the building or lot's location, as well as maintenance costs.
For example, the service charges typically go within the 10-25% range in the last couple of years. The increase was due to the higher costs on electricity charges, costs involved in renovating an upkeep building. These costs typically cover in freehold communities. So as an aspiring Dubai property investment owner, you should be aware of these fees when transacting with developers.
The Good News
While some developers implement hefty service charges, the good news is that the industry listens to their clients. They know the service charges hurt the investors’ pockets in the long run. That’s why they’re offering waivers or freezing of service charges. Some developers are also offering fixed payment terms with no hidden fees. The developers use these as a marketing tool to entice customers into making Dubai property investment.
RERA Steps In
Aside from the developers’ initiative, the Dubai Land Department (DLD) and RERA (Real Estate Regulating Agency) stepped in since last year. Both agencies implemented a complete overhaul of Dubai property investment service charges. They also regulated who can and how to manage these freehold properties. This is to ensure the investors won’t be abused by developers.
At the same time, this movement empowered the homeowners’ associations. The RERA also directed developers to set up homeowner associations when they develop new freehold projects. They also need to get their completion certificates before they can transact with their clients.
Direct Control on Service Charges
RERA also has direct control over service charges now. The agency has set up dedicated auditors to handle the budgeting before handing it down on the association management companies. Only RERA will have the final word on determining the service charge depending on the type of the building for a 12-month period.
Dubai property investment owners will sigh in relief with this new implementing rules and regulations. While the new rules are still implemented and subjected to changing trends, they can be rest assured that they won’t be paying hefty service charges for a long time. At the same time, they’re protected by DLD and RERA should their developers violated the contract. This will also attract more investors into buying more properties in Dubai.
The waiver and possibly freezing of service charges will certainly boost the Dubai real estate market. The experts say this will attract customers into making Dubai property investment during this pandemic. Not only the prices are affordable, but they’ll enjoy free service charges too.
The experts encourage Dubai locals and ex-pats to take advantage of this golden opportunity. Once a cure or vaccine has been found and Dubai Expo will resume next year, there’ll be no doubt the prices will skyrocket again.
Contact our professional real estate experts now for your Dubai property investment!