Rera insists on service fee disclosure by owners

Dubai’s Real Estate Regulatory Agency (Rera) has confirmed it is considering asking either property owner or building manager to issue a disclosure statement on service charge dues on the property before it is rented.

Speaking to 'Emirates 24|7', Mohammed Khalifa bin Hammad, Senior Director, Real Estate Regulatory Agency (Rera), said: “We will discuss this concept further with all parties – property owners, lawyers, owners’ associations, real estate agents - and decide on who will issue the disclosure statement.”

This website reported last week that Rera was likely to make it mandatory for landlords to provide a service charge disclosure statement. The move was aimed at safeguarding renters who have no way to know if their landlord is a service charge defaulter.

Zubin Firozi, Head of Property Management, Head Office, Better Homes, had said: “We have been told that Rera will be implementing a disclosure statement procedure which would make it mandatory, regardless of the lease agreement, that the Landlord discloses his service fee payment status to a tenant or buyer of a property.

“Such a statement would be provided directly by the owners’ association manager. This will really help the situation once it is implemented.”

 Ashok Desai, an Indian who owns two apartments in Dubai Marina, says he is not opposed to the idea.

"Owners who don't pay their dues should pay somehow or the other. They can't just collect their rent and refuse to pay the service charges when others pay on time. I beleive Rera needs to introduce this system so it stops these defaulters from renting their apartments till they pay their dues. This could put an end to all the problems."

Service charge has been contentious issue for years in Dubai and of late a number of developers have taken stringent measures such as barring tenants/owners from accessing facilities (gym and swimming pools) to even ceasing garbage collection services.

Real estate brokerage firms have told this website that not many tenants ask landlords to furnish evidence on payment of service charges before signing the tenancy contract.

“Not all renters check whether the landlord has paid service fees or not, but we see it becoming more common among renters who want to rent on The Palm,” Firozi had said.

Nakheel is the only developer in Dubai that offers potential tenants to seek information on the outstanding service charges of a property owner in the Palm Shoreline Apartments.

Moreover, tenants of landlords, who haven’t paid their service charges, favor the “name-and-shame” policy, which is now becoming a common and an effective tool for developers here to collect their dues.

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