The new law makes registration compulsory with the Land Department and also stops developers from charging transfer fees on such sales. But they will be allowed to accept administrative charges that are approved.
Any sale or other disposition that transfers or restricts property titles will be void if not registered in the interim real estate register, the new law stipulates.
Any developer who makes a sale or other disposition before the law comes into effect must register it within 60 days.
This comes on the back of a new mortgage law that stipulates that mortgage contracts must be registered with the Land Department, specifying the size of the loan, the repayment period and the value of the property to which the loan is linked.
All these moves have been welcomed by developers, lenders and real estate agents. It is hoped they will put an end to mass speculation in the off-plan market and help control escalating property prices.
Buyers are also protected by regulations. The Real Estate Development Trust Accounts law, for example, requires all developers to open trust accounts in which the amounts received from off-plan units buyers are deposited, and not used until the project is finalised.
'We believe that speculative buying may harm the real estate market by pushing prices up to unrealistic highs. This has the ability to lead to a "real estate recession", therefore laws that regulate the property trading process are in the interest of all the parties involved in this sector,' said Marzooq Al Rashdan, vice-chairman and managing director of Abyaar, a leading boutique developer.
