Ineffective snagging can cost owners dearly

Developers in Dubai are not properly snagging their buildings and villas at the time of handover to homeowners, according to facilities management and property management firms.

As a result, many units end up with poor quality finishes and a number of plumbing complaints, they told Emirates Business.

Speaking to this newspaper, industry officials said owners and tenants tend to ignore the upkeep of their property, resulting in costly damages to the property and its owner.

Gary Bugden, Executive Chairman, PRDnationwide Middle East Real Estate, said: "Both big and small developers tend to ignore [undertaking] due diligence of snagging procedures. In fact, some small sub-developers offer excellent snagging procedures while some large developers make a poor effort.

"Previously, because of the development frenzy in Dubai , developers at times ignored snagging procedures. Now that the development frenzy has passed, there is no excuse left for ineffective snagging procedures by developers."

Werner Maluck, Managing Director, Focus International Life Cycle Management, said: "Today, some things that developers tend to miss out are giving their clients updated project documentation. If these documents are missing, then it will be difficult for owners to identify the total square foot area handed over by the developer and what was promised in the contract."

Cosmetic errors

Donna Newman, Head of Property Management, Landmark Property Management, said: "Developers do not [undertake] snagging of their properties with the intention of clearing any cosmetic errors. They would only look at it from a construction point of view. Snagging from an owner's perspective gets done only by property and facilities management firms."

According to Landmark, during the hand over process, buyers get a Defects Liability Period (DLP), a kind of warranty from the developer for a year from the handover date.

Newman clarified the DLP covers only specific equipment for failure.

"A lot of people have this false [impression] that developers tend to look after the newly handed over property for a period of one year under the DLP. However, that is not true. The DLP only covers specific equipment like air-conditioners and water heaters for failure. Maintenance is not covered under the DLP and other defects such as fixtures are the onus of buyers to replace," said Newman.

Newman said during the DLP of a new property, a majority of defects surface within the first three months of the handover. "Gradually through the year, the number of people [pointing out defects] in the property will fall. It is important for buyers to get their houses checked in the early part of the handover and get their snag list in place at that time," said Newman.

Ignoring property

Landmark Property Management said property owners and tenants tend to ignore the inclusion of facilities management service offerings at the time of taking charge of their property unit. "It is the best possible scenario to have FM [facilities management] and PM [property management] involved in a unit, right from the time of the handover of the unit," said Newman.

She said the tenant is usually not bothered about the maintenance and upkeep of the property since the ownership of the property rests with someone else. "A tenant would not even notice a small bore in the ceiling until it starts expanding and creates a huge patch on the ceiling," said Newman.

She advised owners to get a quarterly inspection of their properties for defects and failures.

Sharing case study reports with this newspaper, Newman said: "AC filters are often not maintained and the buyer is unaware of leaks that can cause huge water retention and even have the ceiling coming down."

According to Landmark, other typical examples of ineffective snagging are condensation build-ups from ACs, damaged wardrobes, unfinished work around the power socket areas and unfinished masonry works at the entrance of the house, amongst others.

Bugden said car parking, infrastructure and community facilities are the main problem areas. He maintained community facilities are often not completed and provided as promised. "Also, sometimes the facilities are provided but they end up privately owned and charges are applied for the resident's use. Often this would not have been made clear at the point of sale, or in the case of some developers, they might have simply changed their plans," said Bugden.

The lack of Dewa and district cooling services has also been a problem in many developments due to delays by utility provider and the master developer.

"In such cases, even efficient snagging does not overcome the problem of lack of utility services. Some developers suffer because utility services are not available. If the apartment cannot be occupied because of lack of services, then the defect period does not operate as intended – the purchaser does not have the full 12 months to ensure everything is in order," said Bugden.

"This is a real problem area because the law is uncertain and the practice is so diversified. Issues arise like the way in which area is measured and what is included and excluded like balconies and car parking," he said.

Bugden said that structural changes to the building during construction have also been a problem for buyers. "It also needs to be said that many purchasers have benefited from these uncertainties and changes in that they have received substantially more area for no additional charge."

He said compensations are given out to buyers and is usually negotiated with the developer and often with the assistance from the Real Estate Regulatory Agency (Rera). "From what we have seen, price adjustment is the preferred approach as compensation."

Services

Landmark Property maintains that it gives its customers an 'owners and tenant handbook,' providing details of the tower or the community for the buyer.

The property management firm also does a condition survey for its clients, which is a detailed snagging report and writing down every snag in the apartment or villa and photographing it.

According to Focus International Life Cycle Management, through a professional FM consultant, the scope of services can vary.

Supporting the soft handing over and commissioning process, supervising the snag listing and related performance, support warranty management implementation, monitoring of initial performance of installation are some FM services offered to homeowners.

Handover process improves

The financial management and property management experts said developers today are becoming more conscious of improving their handover process.

"In the recent past, some developers have focused on the handover process and are genuinely concerned to ensure they provide a good experience for the purchaser."

Citing an example of developer Manazel, Bugden said the developer has a dedicated snagging team that carries out advance inspection to identify problems for the investor.

"In case of the Al Reef villas, Manazel has a dedicated snagging team that carries out advance inspection to identify and attend to problems for the purchaser," said Bugden.

He said the team takes the new owner through the property and notes any further concerns that the owner may have.

"Another example of a developer is Deyaar with respect to Citadel. Deyaar has a comprehensive snagging process and well developed documentation to assist purchasers during the handover process. Deyaar's residential building, Addison Residency, also has a very efficient snagging and handover process."

Maluck also said that developers are taking efforts to involve facilities management into the development of their projects at early stages.

Newman said it was very essential to have on board a facilities and property management firm right at the start of the development.


Check list

Buyers need to ensure that they get all warranty certificates at the time of handover of their property from the developer for the gadgets in the house including ACs and water heaters.

Buyers should not be afraid of going into their house and checking for defects such as trying out their doors, windows/kitchen cabinets and really spending time in their houses.

Buyers should be aware of what paper work they should be receiving from the developer at the time of handover and not sign any papers until the developer has made the due changes to rectify any defects in the house.

The papers that buyers need to look out for from the developer are the warranty certificates for the AC units and the water heater. Buyers should ask for a layout of the apartment or villa in order to see where the plumbing lines and electrical points run in the house.

According to Landmark, a lot of developers do not provide this detail but there are some who will give the owners a full handbook of information of the whole tower/community.


What is snagging?

Snagging is a normal and expected part of the building process. As a building settles on its foundations, there can be significant knock-on effects on its structure and finish.

Problems can range from major shifts of the building's structure to a cupboard sticking or drains not working.

Identifying faults and rectifying them before a developer hands over the property to the owner is called snagging.

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