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What you can do if your property project is on hold
According to a recent report, 243 real estate developments in Dubai have either stalled or been cancelled. Here are six courses of action if it happens to you.
March 8, 2010 3:09 by Aarti Nagraj
5. Create an investors group
If you put your heart and soul into your investment, and want your dream home to come up at any cost, you could try gathering investors in your development, form a group, and then pressurize the developer to complete your project. One case which caught international attention was the Palm Springs Investors Group formed by owners in Damac Properties’ Palm Springs project on the Palm Jebel Ali.
The project was due for completion in 2008, but in March 2008, the developer cancelled the project, blaming redevelopment of the Palm Jebel Ali by the master developer, Nakheel. Angry investors, many of who are from the UK, managed to create massive media interest in the campaign; and in April, the developer re-instated the development.
6. Dump your initial investment
This is the last, most desperate option. Considering that the property market has fallen hard, with prices around 50 percent lower than they were two years ago, that AED1 million property you invested in back then might now be worth AED500,000. So, rather than paying the mortgage when your property is (finally) ready, one option is to walk away, and write it off as a bad investment. While this is costly due to the lost deposit – not to mention heartbreaking to let a property go – it is the only course of action available for some. And it means you are not lumbered with negative equity.