Residents require greater transparency on maintenance fees

Residents are calling for greater transparency over how money is spent on the maintenance and upkeep of apartments. Laws regulated by Dubai’s Real Estate Regulatory Authority (RERA) say that homeowners should be able to monitor how service charges and maintenance are being spent by participating in owners’ associations.

However, despite the ‘Strata Law’ being in place for almost a year, few associations exist in the emirate. Instead, home owners in areas such as Discovery Gardens, The Palm Jumeirah and Jumeirah Beach Residence (JBR) have taken to organising unofficial committees to battle recent hikes in maintenance costs.

In JBR, maintenance fee hikes of as much as 129 per cent have hit owners. An apartment owner, Cecilia Reinaldo, is behind the efforts to organise a committee to fight the increases.

“When we moved in we were shown a brochure which promised five beach clubs and a beach park but it’s been a year and we haven’t seen them,” she said. “I don’t know where this money is going.”

She added that the contract said that as soon as the first building was registered with Dubai Land Department, an owners’ association should be set up to look at how the maintenance fees were being spent. However none has been formed.

“Some of the people I spoke to said they wished they’d have rented, instead of buying the property,” she said. “If they go up across the board then demand for properties will fall further.”

A spokesman for Dubai Properties was unavailable for comment. However, RERA CEO Marwan bin Ghalita confirmed to Khaleej Times that Dubai Properties had already sought out RERA for talks about setting up an owners’ association. Acting on behalf of Dubai Properties, Salwan Property Management sent out a notice to residents informing them that maintenance fees would rise from Dh9.5 per square foot to Dh21.75 per square foot.

Vincent Easton, sales manager at Sherwoods said: “These properties have been subsidised for a while now and I expect we are seeing the real price. Dh9.5 per square feet is quite cheap.”

Coupled with delays on moving in, residents of Discovery Gardens have had large maintenance fees sprung upon them without being forewarned.

Neil Whittaker, who was due to move into the property in June, but wasn’t handed the keys until November, said that he was asked to hand over a sum of Dh45,000 before he could move in. The bill included maintenance charges of Dh15,894 as well as community service fees and other charges.

“Nobody told us about these charges,” he said. “Nobody has told us how they got these figures; what it’s based on; if it’s market rate; if they are annual; if they will stay at this rate year after year. Nothing. I foresee many a fight with Nakheel about it but we have the house now and we are moving in.”“For a limited number of properties at Discovery Gardens, it was necessary to revise completion dates,” said a spokesman for Nakheel. “This was due to circumstances beyond our control.

“For all of Nakheel’s developments, each year’s service charges are budgeted according to the projected costs, and all accounts are independently audited to ensure accuracy and transparency for homeowners.”

Meanwhile, Palm Jumeirah residents have fought back against Nakheel’s plans to increase maintenance fees by as much as 40 per cent.

However, third parties not involved in the dispute said that Nakheel had been -on the whole- responsive to residents’ concerns. No one from the owners’ committee that is involved in negotiations was willing to comment to the Press.

Khaleej Times

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