Investors against interpretation of law no 13

[TommyC]

As posted in the escrow thread:

Hi Escrow officer, I have a question for you:

They money I've paid so far for my apartments in The Signet by Schon properties have been adressed on the cheque to "Luxor Investment Limited". Are they the holder of the escrow account or whom have I paid to??

The reason I'm asking is because of this ad: http://www.realtyna.com/dubai_real_e...realty-21.html

The seller is claimed to be "Luxor Investment Limited" for an UNSOLD apartment. How does that make sense? How can I be sure my money have actually been placed in an escrow account when the name I put on the cheque is selling UNSOLD apartments according to this ad?? Doesn't make sense to me, or have I missed something?

From RERA's website:
When buying "off-the-plan" only pay into a RERA approved trust account. The cheque and receipt must read in the name of the project. If you pay your monies into the developer, agent, or any other account, the person or company you are dealing with is breaking the law.

Luxor Investment Limited is listed as DEVELOPER!!

I'm feeling concerned that this is some kind of scam by Schon to circumvent the escrow account!

According to the projects list on RERA/Land Department website, the developer for "The Signet" is "Luxor investment limited" and the escrow account holder is "Badr Islamic Bank". Shouldn't the cheques have been adressed to "Badr Islamic Bank" in the first place, or possibly "The Signet"?

Anyone experienced the same?

[therealdubai]

The bank account is the same in the reservation form and the payment reminder, if this what you meant.

[TommyC]

Originally Posted by therealdubai

The bank account is the same in the reservation form and the payment reminder, if this what you meant.

If you read the post you will see that I mean that the "bank account" I've paid my money to is selling UNSOLD apartments. What's going on?

[TommyC]

International coverage of the bubble burst in Dubai: Final nail in the coffin for Dubai's property market? - Building

[zombie]

Just a quick thought, I don't think this article which change anybody's mind, people are already sure that investing in Dubai Off Plan Market is a very Bad Idea,

The final nail has already been driven in a long time ago. Now investors are just waiting to see how these legislations are modified in the future & what is the total loss they are expected to bear.

Like I have mentioned in some other posts here, 30% of contract value basically equals 50-70% of project cost to the developer, the government tried to control the losses its own companies face if contracts are canclled & in this dead market reselling off plan is a lost cause, thereby trying to keep its bottomline from going bust.

We just hope that somewhere some sense prevails & someone sits down & does the math that if the investor is kicked in his B****, this market will take decades to recover, & only when the next greed cycle comes up.

Originally Posted by TommyC

International coverage of the bubble burst in Dubai: Final nail in the coffin for Dubai's property market? - Building

[Ajmanprop]

I liked the article - agree it may be preaching to the converted - but even if it gets to a single reader considering a purchase and gives them pause about buying off plan, it would have been well worth it.

There are guys peddling off plan daily, brand new launches, 15 month old launches with no construction and no one to stop them. Most new off plan buyers are risking the equivalent of walking into a Ponzi scheme - new launch funding transferred to overhead &/or adding a bit to a prior partially sold project.

No matter how many people get burnt, there are queues of new ones who think it will be different for them.

I think we'll see more developers throwing the towel in - although this guy was an aggressive scammer. He should have done it like the others.... collect the money, don't build and buy back in 5 years instead of 5 months...without postdated cheques.

Police seek Al Barakah executive - The National Newspaper

[DelboyG]

Gents, an excellent article can be found here:

Deconstructing property law - Real Estate - ArabianBusiness.com

Could be helpful for anyone with difficulties.

[therealdubai]

Any body have news about Al Humaid City-Al Rashed development?

[dbxdude]

Originally Posted by Ajmanprop

I liked the article - agree it may be preaching to the converted - but even if it gets to a single reader considering a purchase and gives them pause about buying off plan, it would have been well worth it.


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Just to re qualify that - there are some amazing deals such as on villas in Dubai and palm appartments that are almost complete, by off plan you mean the new launches and projects far away from completion - yes you would have to be brave to get involved in those now.

Also i still think anyone invested in projects by the Dubai Big 3 has a low risk compared to anyother developers in the UAE since if they do cancel projects they will return the money.

Dubai has had a very public profile and so alot of the global press are enjoing taking a bash at them but the lights arent going out anytime soon. . .

[escrow_officer]

Update After Meeting With RERA.

1 - Law 13 with amendment applies to all projects registered after 31/08/08 and LAw is

" Developer is entitaled to retain 30% of the money deposited and on top of that 30 / 70 on remaining. "

Projects registered before 31/08/08 would be treated according to their respective contracts.


2 - Payments would be linked to Construction from now on though wouldnt be avilable in written for some time But decision has been taken.


3 - Developers are not entitled for any kind of interest for the money deposited by the investors. Developers wouldnt be able to claim it.

4 - Developers wouldnt be able to withdraw funds from Escrow anymore as previously was allowed under Cost & revenue Excess.


Regards
Escrow