Real estate investors confirmed that the high service and maintenance fees in Dubai are one of the most important problems they face when thinking about buying a property, noting that this reflects negatively on the return on investment.

And they demanded the regulatory authorities in the emirate to reduce those fees, and audit the facilities management companies, noting that they are waiting for the effect of the joint ownership law in them, after the law was finally issued.

For their part, experts from the sector told Emirates Today that the high fees for services have become an obstacle to the investment decision in the real estate sector, especially as investors have become more aware of the impact of fees on the value of their investments, which makes the investment decision to be made after a thorough study.

In turn, the Real Estate Regulatory Agency «RERA» explained that the service fees are collected to maintain the building and the level of services in it, expecting the new “owners” system to contribute to reducing and controlling fees.

It is noteworthy that the "owners" of a new electronic system launched by the Dubai Land Department, with the aim of assisting owners of real estate with joint ownership in dealing with real estate management companies.

Attractive prices

In detail, the investor, Jamal Al-Hassani, said that he is considering buying a housing unit in Dubai, but what worries him is the high service and maintenance fees, especially that he buys the property for the purpose of investment and reliance on the rental return expected from him, asking the regulatory authorities to control and reduce those fees, and audit companies Facility management.

For his part, the investor, Mr. Hajir, stated that the arrival of real estate prices in Dubai to attractive levels of purchase, with offers described as "strong" by real estate development companies, made him think seriously about buying a property in Dubai, but he postponed the decision after some advised him The necessity of knowing the services and maintenance fees accurately before investing in the real estate he will buy, stressing that these fees should be reduced by the regulatory authorities.

High fees

In turn, Islam Al-Raisi, who is the owner of a housing unit in a new residential complex in the Motor City area, said that the service fees in the complex are very exaggerated when compared to the prices of neighboring areas such as the “Sport City” and “Jumeirah Golf Estate”, stressing that The importance of reducing these fees to encourage investors.

In the same context, Hamza Mohamed Mansour explained that the fees for services and maintenance that the developer develops for the property he owns, is 5.8 dirhams per square foot annually, compared to 4.5 dirhams for neighboring projects, pointing out that the Facilities Management Company, which is affiliated with the real estate developer, provides some traditional maintenance services , As well as two building security services.

Costs

In addition, the founder and CEO of Al-Ruwad Real Estate Company, Ismail Al Hammadi, said that the service fees have become a street talk in Dubai during the recent period, as they are not clear and often accurate, in addition to the fact that investors have become more aware of its impact on their investments and return. , Noting that most investor questions before buying relate to the value of service fees because they are paid annually.

Al Hammadi explained that the fees for services in Dubai are governed by several costs, including infrastructure, maintenance, central air conditioning, electricity and water, and the nature of the building, as they differ from one region to another and from one building to another, according to the specifications that characterize the building and the nature of its location, so the investor sees it as high in areas It is low in other areas, and it may be confused because he does not realize the reason.

He added that the obsession with the continuous rise in service fees is what scares the current and potential investors of the real estate market in Dubai, pointing out that in this case the competent authorities must take effective action to put in place strict laws that would stabilize the value of those fees to serve the interests of both the market and the investor.

Difference of fees

For his part, Matthew Gregory, director of the "Dubizzle Real Estate" platform, said that the "owners" system has not yet contributed to reducing service fees, as there is no actual change, noting that since last November, the calculation of the balcony and the "terrace" had begun. Within the built-up area, so the new laws and the "owners" system have not contributed to reducing service fees yet.

Gregory pointed out that the fees for services related to residential real estate, such as buildings, apartments and villas, are to be paid all over the world, explaining that these fees are rising in the most distinctive housing complexes and with the increase in the area of ​​the property.

This is evidenced by New York City, for example, as its buildings are similar to Dubai buildings in its height, indicating that the average service fee in New York is $ 1.73, while in some areas of Dubai these fees amount to six dollars (about 22 dirhams) for the most distinctive buildings .

Gregory stressed that these fluctuations in service fees can hinder investment for certain groups of buyers, especially end-users who buy in order to live rather than invest.

He stressed the importance of reducing and controlling service and maintenance fees, considering that this will undoubtedly contribute to increasing investments in the real estate sector.

Frequency

In the same context, the real estate expert, Muhannad Al-Wadi, said that there are a lot of investment decisions that are hesitant to take due to the high prices of fees and services, indicating that some investors wanting to buy we find at the moment they stop a lot at the annual service fees calculated on the housing unit , Being focused on the return on investment from the purchase of this unit, before and after calculating service and maintenance fees.

The valley mentioned that there are great efforts made to reduce these fees, but so far their results have not been fully shown in the market, and it is expected that the new laws and regulations will contribute to filling the gaps related to the rise of these fees at times.

"Angel"

In turn, the RERA, the regulatory arm of the Dubai Land Department, reported that service and maintenance fees are obtained to ensure the maintenance of the building and the level of services therein, noting that the new “angel” system is expected to contribute to reducing the maintenance and services bill , Especially with the presence of financial auditing of companies operating in the field of real estate management.

"Rera" explained that the system of "owners" gives the owner details of the exchange of every fils of services costs, expected that this system will contribute to preserving real estate wealth in Dubai through the sustainability of building maintenance.

Offers

During the recent period, a number of real estate developers have launched offers related to service and maintenance fees, the most prominent of which is a display of a tower on Sheikh Zayed Road, which includes an exemption from service fees for 10 years, in addition to providing easy payment methods that include paying only 1% per month.

Developers emphasized that this contributes to stimulating sales movement, especially with some investors hesitating to buy real estate for fear of these fees.

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Dirhams per square foot can reach fees in some areas of Dubai.

Investors indicated that they are waiting for the effect of the joint ownership law on fees.