Posted: 15 December 2013
A new law regulating Dubai’s holiday homes market is likely to appreciably benefit two of its foremost industries, tourism and real estate, and represents an important step towards achieving Dubai’s vision of attracting 20m annual visitors by the end of the decade.
However, implementing a new programme encompassing a tier of a new line of accommodations called holiday homes, may face some immediate challenges that need to be overcome when introduced to the market for the first time.
Eli Hyder, Managing Partner of Bond lawyers, says, “Dubai is internationally renowned for setting world class hospitality standards; the difference in the quality of its hotels compared to many other parts of the world, including even advanced countries in Europe and North America, is easily perceptible. Introducing a new line of products should help maintain such standards and continue to build on Dubai’s excellent reputation.” Mr. Hyder added, “Consumer rights, safety and relations between homeowners and regulators will be key issues to be addressed at an early stage.” The impact on tourism is expected to be significant. Dubai has already commenced a drive to increase the range and supply of accommodation available to foreign visitors, most notably in September, when DCTM announced the award of financial incentives to encourage the development of new three and four star hotels.
A robust regulatory framework governing holiday homes will considerably expand tourists’ options, enabling foreign visitors to book such properties with complete confidence in the rigorous criteria that govern their quality and management.
The real estate industry, meanwhile, will also look upon this law as a promising development. The guarantee of quality encompassed in mandatory licencing is likely to improve market stability, while owners of second homes will, bolstered by the ensuing growth in tourism, have a financially viable short- term alternative to renting their properties on an annual basis.