Speaking about the compensation mechanism for delays in the delivery of off-plan projects, the CEO of NHC , Mr. Mohammed Al-Bati, emphasized that this issue is one of the most important challenges facing both developers and customers, acknowledging that there are some misunderstandings in this regard, adding that the new system approved by the Council of Ministers aims to strike a balance and protect the rights of all parties, whether the developer or the customer.
Al-Bati explained during an interview on the “In the Picture” program on Rotana Khaleejia TV that the customer is the primary focus, especially in cases of delays in the delivery of residential units, as such delays are considered a major problem that may affect the circumstances of “first-time homebuyers,” who face challenges with rent and monthly installments. In this context, the system stipulates that the customer is entitled to compensation in the form of “equivalent rent” in the event of a delivery delay beyond the prescribed grace period, which can be up to one full year. He added that the compensation is calculated based on the number of days of delay and is paid after the residential unit is delivered, with the reason for the delay specified.
He noted that the new system has recently undergone amendments, whereby the rate—which was set at 7% in the previous system—has been changed so that “equivalent rent” compensation is now calculated on a daily basis, ensuring greater accuracy in the calculation of compensation.
Regarding the options available to customers, the NHC chairman confirmed the existence of a "loyalty program" that offers customers several choices in the event of a delivery delay. If a customer wishes to take advantage of this option, they can exchange their unit for a ready-to-move-in unit within the same project; in some cases, the new unit may be larger or more expensive than the original one, without any additional cost.
Regarding financial compensation, Al-Bati explained that customers are also entitled to financial compensation based on a percentage of the market rent, with the percentage determined flexibly according to the extent of the delay, while ensuring that discussions with customers are clear and transparent.
He emphasized that the General Real Estate Authority is responsible for assessing the causes of the delay and determining the appropriate compensation. However, he noted that these options are presented to customers prior to unit handover so that they have the freedom to make the decision that best suits them.
In conclusion, the NHC Chairman emphasized the company’s commitment to meeting its customers" needs, noting that approximately 69% customers have agreed to the "Walaa" program, which offers flexible options for compensation and changing residential units.
