It gets worse, anyone with deposits paid on schemes from “Government owned” developers like Nakheel have already been badly treated when schemes are cancelled – they have either been ignored and deposits retained or at best offered six months to move to a new scheme, and not at bargain prices like the rest of the country. Effectively their deposits are lost.
It gets worse still, even where the scheme isn’t cancelled, the property may not be built for years, or ever. Finance won’t be available on the same terms as when people bought so it may make the property unaffordable from a deposit point of view and even worse the buyers are committed to prices that could now be 3 times the current “value” or worse.
It could get even worse than that – even foreign property owners who now own completed property should beware – the Sheikh has pulling the plug on supporting Dubai World may just be the beginning. Assetz has long distrusted the long time it took for the Sheikh to finally provide a form of freehold instead of leasehold and speculated it could have been because the Sheikh never really intended to offer freehold and really just wanted foreign capital to build the new Dubai and at some point foreign ownership could be revoked at the end of the leases and the value of the built real estate could be taken back.
That time may well be approaching decades sooner than we thought and foreign owned property could be taken back onto a leasehold basis (or worse) to prop up Dubai’s collapsing balance sheet….
The grand reversion to quality, the western world and well established legal regimes continues.
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