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28 March 2024

Springs villas, Marina apartment on the block in first Dubai property auction for 2012

Published
By Parag Deulgaonkar

The first public auction of foreclosed properties in Dubai will be held on March 19 with four properties - two villas and two apartments - going under the hammer.

Both the villas are in the Springs community, while the apartments are located in Dubai Marina and Jumeirah Beach Residence (JBR), respectively.

According to Dubai Land Department (DLD), the three-bed Springs villa (4,136 square feet, Type 2E, Springs 3) is listed at a reserve price of Dh2 million, while the two-bed villa (1,879 square feet, Springs 7) will be selling for a base price of Dh1.25 million.

Reserve price for the one-bed apartment (860 square feet) in Al Sahab 1 building in Dubai Marina is set at Dh1 million, while the three-bedroom apartment (2171 square feet) in Rimal 4, JBR, is listed with a base price of Dh1.6 million.

Property agents and online property websites have listed similar villas in Springs 3 for between Dh2 million and Dh2.15 million, while Springs 7 units are available for Dh1.05 to Dh1.2 million.

One-bed units in Al Sahab 1 is priced between Dh1.05 and Dh1.1 million, while three-bed Rimal 4 apartments can available in the market for Dh1.85 to Dh1.9 million.

Another round of auction will take place immediately on March 21, where two one-bed apartments in South Ridge 1, Downtown Burj, will go under the hammer.

Their reserve prices for the two properties are Dh900,000 and Dh800,000, respectively.

A one-bed (748 square-feet) apartment in the Greens will also being auction.

The base price is set at Dh600,000.

Asking market price for South Ridge 1 apartments are Dh1.05 million to Dh1.20 million, while a similar Greens apartment is priced for Dh700,000.

Barclays Plc was the first bank to have successfully closed a property sale at a public auction in May 2011.

In December, the department managed to sell a two-bedroom 1,800-square-feet Springs villa for Dh1.306 million (base price of Dh1.1 million), while a 3,511-square-foot, three-bedroom villa in Springs 11 was sold for Dh1.82 million (base price: Dh1.5 million).

Procedurally, only after the Dubai Court has made an order for a property to be sold at public auction in accordance with the Dubai Mortgage Law, the court will send a letter to the land department, requesting them to arrange for the property to be auctioned.

The department will then arrange for the auction to take place subject to the procedures and rules put forward by them.

In order to set a reserve price on the property, the department will arrange for valuation of the property to be undertaken.
However, it is not clear on what basis this valuation is carried out or the factors taken into consideration.

There is also a risk that the resulting value will be much lower than the mortgage amount.

Nevertheless, the Mortgage Law provides that where the proceeds of the sale are not sufficient to cover the debt, the bank can claim the difference from the borrower.