property law


September 26, 2016



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Dubai Property Agents Required to Verify Ownership Data Before Brokering Sales and Rental Deals

The Dubai Land Department (DLD) has told property brokers to ensure that any landlords who approach them with properties available for sale or rent actually own them.

The department's real estate licensing arm said in a circular that it now requires all of its registered brokers to "verify real estate ownership data" before selling or renting a property, and that verification can be carried out through its own Smart Broker app through which owners submit registration details.

The new system will help to combat real estate fraud, which has been a common problem in the UAE and one which Hassan Elhais, a legal consultant with law firm Al Rowwad Advocates and Legal Consultants, told The National in June was on the rise. Potential tenants and owners have handed over sizeable cheques either to supposed owners or representatives to move into properties only to find that they are owned by someone else.

Ali Abdullah Al Ali, a director of DLD's Real Estate Licensing Department, said that there "have been issues of tenants paying supposed landlords and brokers, as in the past the procedures were difficult to check the property ownership data".

However, he said the new app service has been introduced to "provide more transparency and protect the rights of all parties in the real estate market".

Brokers who fail to verify ownership data will face legal proceedings and fines for non-adherence, he added.

"Real estate brokers play an important role in supporting DLD's vision through the promotion of real estate transaction movements in the emirate. Therefore, we appreciate their work in facilitating secure transactions."

Andrew Love, the head of investment and commercial agency at brokers Cavendish Maxwell, said: "Brokers have always been required to obtain the title deed prior to listing or selling any property, but verifying its accuracy or legitimacy has historically been a little trickier.

"However, the creation of the new Dubai brokers app makes it very easy now."

He said that this additional requirement being placed on brokers offered "another level of protection for buyers".

Jason Hayes, the managing director of luxury property brokerage Luxhabitat, said: "Owner verification has been a cornerstone of our standard operating procedure for some time, but regrettably we recognise our own standards are not reflected across the city. Today's announcement serves to address that disparity and we welcome that news."

Mr. Love added that most professional real estate firms will carry their own professional indemnity insurance and that buyers should check the validity of this as they can potentially claim against this in the event of broker negligence.

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