Dubai Land Department has quashed rumours that it was planning to double registration fees for property owners who failed to register their homes by today.
The department issued a statement yesterday that said the registration fee, which was increased from 2 per cent to 4 per cent in September 2013 to cool growth in the real estate market, would not be increased further.
Developers and home owners were required to register their purchases on the Dubai Land Registry by June 30.
It is understood that the department decided to issue the statement because it had received numerous inquiries from concerned buyers who were desperate to register their property, fearing that they may subsequently have to pay a fee of 8 per cent.
“A number of market players are talking about alleged reports that the Dubai Land Department will be increasing real estate registration fees from 4 per cent to 8 per cent,” said Sultan Butti bin Mejren, the department’s director general.
“This is a baseless rumour and only serves to encourage the return of speculation. It confuses buyers and also needlessly compels them to speed up their purchasing decisions.”
He said that those who are selling property should do so professionally and focus on promoting values such as price or quality.
The department also postponed the June 30 registration deadline by four months. Developers and homeowners now have until October 30 to register their property.
The registration fee was increased to cool an overheating market by making the practice of flipping – buying a property off-plan and quickly selling it on for a profit – more difficult.
Mr bin Mejren said there was no need to revisit fees, as the property market in Dubai is stable.
Figures from Dubai Land Department’s website show the value of villas and apartments sold in the first five months of last year dropped as much as 46 per cent from the same period a year earlier to Dh10.3 billion.
Dubai property prices are currently in decline after three years of sharp appreciation.
A study published by the research company Phidar Advisory this month said sale prices of new apartments dropped by 1.5 per cent during the first five months of this year, while single-family homes declined in value by 2.9 per cent.
The volume of single family homes sold shrunk by 25 per cent, however.
A report from the global ratings agency Standard and Poor’s last week said that prices could fall by up to 20 per cent this year, but it added developers were prepared for a fall of that magnitude.