UAE: Real estate developer suspended for violating trade permit laws, promoting unlicensed projects
With Abu Dhabi tightening realty laws in order to protect buyers in recent times, authorities have been penalising property owners for violating laws in the emirate, whether related to neglect of sites or promoting unlicenced projects.
A real estate developer in Abu Dhabi was recently suspended for violating regulations in the Capital, the Abu Dhabi Real Estate Centre (ADREC) announced on Tuesday.
The violations committed were related to licensing, trading permits, and promotion of unlicensed projects.
All developers have been urged to adhere to approved legislation and regulatory requirements, with the authority stressing the importance of obtaining necessary licenses before carrying out any promotional activities.
A report from Khaleej Times last year highlighted how several residents were duped by property agents who lured them with false pretences and carefully manipulated photos of properties. Meanwhile, the reality turned out to be different. Some buyers even dealt with advertisements showcasing false rents and sizes.
In 2022, Abu Dhabi launched a digital platform, DARI, to tackle real estate scams, fake agents, online listings of non-existing projects and offers.
The platform — aimed at increasing transparency — shows residents and investors all DMT-approved official projects, leasing, buying or selling of properties.
In another initiative to improve transparency in the real estate market, Abu Dhabi launched the first official rental index in the emirate last year. The platform offers indicative quarterly rental pricing for properties located in areas across the city. Residents can get easy access to reliable data on residential, commercial and industrial properties.
Penalties for property owners
Recently, Abu Dhabi's Department of Municipalities and Transport said it has begun imposing heavy penalties against property owners who neglect their property, leading to distortion of the city's appearance or posing a risk to public safety.
Violators will face hefty fines of up to Dh20,000 for repeated violations, with the minimum penalty starting from Dh5,000 and moving to Dh10,000 with the second violation.
In another announcement, the DMT stated fines of up to Dh10,000 for property owners in Abu Dhabi who partake in fencing, enclosing, or covering their properties in a way that distorts the public appearance.
Tackling the issue of overcrowding in apartments, the authority has stepped up on-site inspections of buildings in the city. Property owners and investors have been urged to comply with regulations to avoid hefty penalties that range from Dh5,000 to Dh500,000. Moreover, any repeated offences will incur fines of up to Dh1 million.
Legal changes across UAE
With a surge in off-plan property and more foreign investors and buyers coming into the UAE to invest in the realty market, emirates across the country have tightened laws to improve transparency and protect buyers.
In Dubai, the Real Estate Regulatory Agency (Rera) established terms and conditions to govern advertisements and curb negative practices within the industry. Last year, authorities fined 286 real estate companies and brokers for failing to comply with regulations.
In 2024, the Dubai Land Department imposed fines of Dh50,000 each to 30 real estate companies for failing to comply with the terms and conditions specified in real estate advertisements.
Soon after, real estate agents in the city were given a three-day deadline to remove all property listings that were unavailable for sale or rent from their digital platforms.
During the first half of 2024, 256 property brokers were penalised for not complying with the advertisement regulations in Dubai.
In a report by Khaleej Times in 2024, property developers revealed how they conduct due diligence on buyers to ensure that no illegal money flows into their projects. This came after the UAE made stricter laws surrounding property transactions in 2022 by asking property agents, brokers, and law firms to report cash transactions worth Dh55,000 and above to the UAE's Financial Intelligence Unit.
Dubai has also upped its crackdown on overcrowding in properties, which includes villas and apartments. The DLD banned 10 property owners from leasing their properties due to overcrowding and safety standards in 2024.
Meanwhile in 2023, Umm Al Quwain's Ruler announced six new laws to regulate the real estate sector. These regulations are concerned with prices, mortgages, real estate transactions and protecting rights of investors.
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