The International Herald Tribune Blog by Kevin Brass carried a post about several major project cancellations in Dubai. Of greater interest to me are the comments to the article by people at ground zero in Dubai. It is amazing that there are few articles about the real problems being experienced by property buyers and very little main stream press about the markets demise in these once highly touted areas of growth.These comments readily apply to what is happening in Panama too.
FROM IHT
The market there is a complete mess, and begging for good governance. In no particular order - here’s what’s happening. Dubai and Ajman leads the pack.
1) Change of tack in visas - after years of promising it - a 180 degree turn in policy means a smaller potential buyer pool.
2) Thousands and thousands of undelivered projects, which in turn
creates and artificial shortage. It also creates tremendous uncertainty
3) Un regulated developers - that don’t own the land, have no intention
of starting construction. The law doesn’t force them to. Instead, they
embezzle the money, or use it for marketing etc.
4) Contracts are routinely delayed from when the booking deposit is put
down….and when it does show up, totally diverges from what is
advertised, promised.
6) The developer requests post dated cheques that are impossible to stop, for any reason.
7) A regulator (RERA) that is primarily focused on developers and
creates a smokescreen of protection, that soon evaporates. Even cases
where RERA has ruled in favor of the end investor, developers openly
continue to flout rules.
8) Even the big developers are stuck for cash, and thus not issuing refunds on projects that they have canceled.
9) The whole game was dependent on thousands of new buyers coming in
and making down payments, but in the current environment and given all
of the local uncertainties that has stopped.
10) Unregulated construction standards and out of control maintenance charges.
Markets everywhere are impacted by the global crisis - but much of what is listed above is locally created.
Buyer beware - but if you have a very compelling reason to buy - check the various online forums, get a lawyer, don’t use post dated cheques - and stay away from off plan.
Lastly, I am honestly stunned that none of the worlds major newspapers have picked up on any of this and say written about this in the Western media. You’d all be doing your readers a favor, by doing some objective research into this.
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