The first public auction of foreclosed properties in Dubai will be held on March 19, with four properties- 2 villas and 2 apartments – going under the hammer
Both the villas are in the spring’s community, while the apartments are located in Dubai Marina and Jumeirah Beach Residence (JBR), respectively.
Another round of auction will take place immediately on March 21, where two apartments in South Ridge 1, Downtown Burj, will also be auctioned.
To be mentioned that Barclays Plc was the first bank to have successfully closed a property sale at a public auction in May 2011.
Procedurally, only after the Dubai Court has made an order for a property to be sold at public auction in accordance with the Dubai Mortgage Law, the court will send a letter to the land department, requesting them to arrange for the property to be auctioned.
Dubai Land Department (DLD) will then arrange for the auction to take place subject to the procedures and rules put forward by them.
In order to set a reserve price on the property, DLD will arrange for valuation of the property to be undertaken, as emirates 24/7 stated
However, it is not clear on what basis this valuation is carried out or the factors taken into consideration.
There is also a risk that the resulting value will be much lower than the mortgage amount.
Nevertheless, the Mortgage Law provides that where the proceeds of the sale are not sufficient to cover the debt, the bank can claim the difference from the borrower.
