UAE residents' Dh137m housing fee 'nightmare' nears court decision

The three-year dispute at Al Hamra Village in Ras Al Khaimah has left some unable to sell their home or without a water supply

Al Hamra Village in RAK has been embroiled in a dispute over charges for three years. Paulo Vecina / The National 

Homeowners at Al Hamra Village in Ras Al Khaimah are hoping for a resolution in court next week to a three-year, Dh137 million dispute with the developer that has left some unable to sell their home or without a water supply.

The dispute relates to the legality of charges issued by Al Hamra Real Estate Development (Ahred) to property owners in 2015, when the gated community switched from a private amenities supplier to the Federal Electricity and Water Authority, Fewa.

The developer claims an upgrade fee of as much as Dh110,000 applies to each property. However, home owners say they paid a connection fee when they bought their properties and that they contacted Fewa directly, who said there was no upgrade fee.

The National reported last year that the community planned to take the developer to court after a number of owners refused to pay the fees and Ahred responded by cutting off their water supply. They also stopped issuing the no-objection letters needed to, among other things, sell their property, paint exterior walls and carry out modifications.

About 200 homeowners served a legal notice through a law firm over the payment request, while 13 have themselves been taken to court by Ahred for not paying the upgrade fees.

Residents of Al Hamra Village say they are being charged for a Fewa upgrade fee, but Fewa have said there is no such fee and the developer has so far not explained what the money is for. Paulo Vecina / The National 

“We never expected to be trapped in this toxic situation when we purchased our dream retirement home from Al Hamra,” said one two-bedroom property owner, who wished to remain nameless.

“This whole experience has left us feeling highly exposed, extremely vulnerable and stressed.”

The owner said she reserved her property in June 2007 and it was handed over in November 2011.

“During that time, Ahred issued a signed and stamped handover report confirming that our electricity and meter registration fees were paid in full at Dh48,000,” she said.

“Following handover, utility invoices were invoiced by and paid directly to Ahred. Several years later and without warning, Ahred demanded we pay for an upgrade.

The owner said that since the first Fewa payment demand in December 2015, residents have issued countless emails to various people at Ahred requesting clarification and a breakdown of the upgrade fee, but have not received a response.

“Ahred are retrospectively billing owners for a total of Dh137m between the various properties at Al Hamra Village, but they refuse to provide any details of what this incredible amount will go towards.

“I secured a buyer for my house, but Ahred refused to issue a no-objection letter until we paid the amount. So we agreed to pay the Fewa fee if we received more information, despite the fact that both Fewa and Ras al Khaimah Investment Authority confirmed in writing that there was no power upgrade in the works.

"However, Ahred again failed to respond and our buyer withdrew after two years of trying to sell them the property,” she said.

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Another Al Hamra Village two-bedroom property owner said her perfect home has become a nightmare.

“They are manipulating us in all ways possible: disconnecting water supplies in peak summer although bills are paid on time, refusing to issue no-objection letters for making any amendments to the property and refusing access to tradesmen to repair leaking water tanks and other essential minor repairs works,” said the owner.

“We used to go to the police and get permission to reopen the water valves after they were switched off because it is illegal to close them if you have payed all of your bills, but now the police tell us to go to court. That costs money.”

Some residents have taken to social media to complain, while others have written letters to Ahred or moved out of the community. The matter is currently in court with the next hearing set for Thursday.

A spokesman for Ahred said: “This matter is now sub judice and as such it would be inappropriate for Al Hamra to comment about an ongoing court case. However, we would like to state that this course of action was only taken as a last resort, and after considerable discussion with the residents.

“Over the last three years, we have been in dialogue with this minority group of owners, but unfortunately we failed to reach an accord.

“We will now let the courts rule on the legitimacy and legality of the charges and bring this issue to a close.”