Real Estate Bill Presented for Consultation

The prospective ‘Real Estate Development and Marketing Proclamation’ bill was tabled for consultation. The bill is intended to address the complaints presented against real estate developers failing to comply with purchase contracts. The current draft of the bill allegedly places stringent requirements on developers in terms of honoring contractual deals.

The prospective bill also deals with the issue of licenses, use of land and space, as well as the transfer procedures for completed houses. The bill prohibits the transfer of homes that are less than 50% complete.

A desk designated for real estate issues at the Ministry of Urban Development and Construction is suggested by the bill.

 

The bill concentrates on enforcing existing contractual and fraud laws as well as seeking to punish developers in breach of any of the provisions of the proclamation although the penalties for late delivery and poor quality of construction are not elaborated.

 

It is expected that future directive and regulations will deal with detailing the penalties according to the bill.

The bill could have dealt more with establishing specific penalties to ensure compliance by delinquent developers according to some commentators.

The threat of revoking the business license of the delinquent developer is a potentially effective deterrent according to Tilahun Teshome, Professor of Law at the Addis Ababa University.

Source: Fortune

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