Knowing the rental laws in Dubai is critical as the number of expats settling in Dubai is increasing each year. The tenants that are uneducated of their rental property rights in Dubai are vulnerable to unethical contractual changes by the landlord. Landlords increasing the rental amount is the most common contractual dispute with their tenants. Before signing a rental contract, tenants must understand the factors which lead to rental increases and their rights regarding contractual disputes. The Real Estate Regulatory Agency(RERA) with the Dubai Land Department regulates real estate laws in Dubai and is the best reference source to understand property rental laws in Dubai.
The Real Estate Regulatory states that the landlord must provide a 90 days notice regarding any changes to the rent contract, breaking the contract or increasing the rent amount. As the tenant, it is imperative to document the date a landlord has requested to change the rental amount. Tenants can legally refuse a rental amount increase if a 90 days notice was not provided by the landlord. Moreover, upon reaching an agreement with the landlord on the rental amount increase, carefully review the entire contract for any addition changes made by the landlord. The tenant can file a case with the Rent Disputes Settlement Centre at the Dubai Land Department(DLD) upon refusing to agree with the new terms of the contract. With high rental dispute cases unfolding in the Emirate, the Dubai government released a rent decree in December 2013 regulating rental price hikes by landlords. Tenants should review this Decree (43) regarding rent property increases before deciding to file a rental dispute case with the DLD.
Per Decree 43, a landlord cannot increase the rental amount if the property unit is confirmed less than 10% of the average rent of similar units within the same area. The landlord can increase the rent amount by 5% if the current rent value is 11-20% less than the average rent of similar units in the same area. A 10% increase is legal under Dubai law if the rent value is 21-30% less than the average rent of similar properties in the same area. A 15% increase can be tacked onto the rent if the rental value is 31-40% less than similar units within the same community. The maximum rental increase is 20% if the current rental value is 40% less than similar units within the area.
As the tenant, it is wise to be aware of real estate market conditions to predict the possibility of rent increasing. Landlords will legally justify their rental price increases based on the rental prices of similar properties in the area. The rental increase calculator by the Dubai Land Department is the best source to calculate rent increases in an area. The results of a rental increase inquiry are immediately available upon providing the property type, area, bedrooms, and current annual rent.
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