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Unjust rent hikes, new fees leave tenants angry

From charging 1 per cent of the rent for contract renewal to hiking rent 60 per cent, realty agents are making residents pay more than they bargained for

  • BY Abhishek Sengupta, Staff Reporter, XPRESS
  • Published: 21:00 May 1, 2013
  • XPRESS

  • Image Credit: XPRESS/ ARSHAD ALI
  • Rental woes: JLT resident Mohammad Nasser says he has been asked to pay 60 per cent more in his rent to stay in his flat xpress/ ARSHAD ALI

Dubai: Real estate agents in Dubai are finding new ways to impose rental hikes.

Mohammad Nasser of Jumeirah Lake Towers found it out the hard way last month when he was asked to pay 60 per cent more than what he had been paying for his three-bedroom apartment over the past two years.

The 50-year old American citizen with mixed Kuwaiti–Lebanese parentage had paid a single cheque lump sum amount of Dh250,000 for a period of two years. His contract expires this July and he isn’t amused at the prospect of either having to move out or pay Dh200,000 for another year.

“I was hoping my landlord would be considerate towards me for being such a good tenant, having paid such a huge amount at one go, but my hopes have been dashed,” says Nasser who owns a security systems company.

To make matters less comforting for Nasser, there hasn’t been any written notice yet, neither from his non-resident Kenyan landlord nor from his agent, who, according to him, informed him about the hike only verbally. “They are playing it smart as I have no evidence of their claims to present to the Rera,” Nasser says.

According to the Rera website the maximum rent a landlord can increase is 20 per cent for a property that’s registered more than 55 per cent growth in market value. As per Rera’s rent calculator, Nasser is entitled to pay zero increase in rent. The website states that the current rent for his JLT apartment is Dh110,000 to Dh150,000 per year. This officially means his apartment shouldn’t attract any increase in rent for at least another year.

However, for other Dubai residents, the concern is not just the spike in rents.

Paula Tavener, who heads the HR department of a banking and finance company, was asked by Rocky Real Estate to pay one per cent of her new rent towards renewal charges. This was after the Umm Suqeim 1 resident paid a five per cent increase in rent in order to stay for a third year. Her question was simple: “Why would I pay an extra Dh1,800, having already agreed to pay a hundred times that for the year?”

The company in turn confirmed that since January the industry has started charging one per cent of the rent or Dh500, whichever is higher.

Comments (55)

Your comments
  1. Added 16:32 May 2, 2013

    Dubai real estate agents always blackmail the tenants. In the last 10 years there has been no proper policy to support the tenants. Being an expat, one has to obey the real estate agents, otherwise the family has to live on the streets.

    balaji, Bangalore, India

  2. Added 15:44 May 2, 2013

    Try to own apartment directly from the owner. Just search 'Direct from Owner'. You will get good rent by talking directly to the owner, thereby saving thousands of dirhams.

    ABC, DUBAI, United Arab Emirates

  3. Added 15:31 May 2, 2013

    This is precisely the reason people left Dubai when the recession hit. The greedy middleman have started their acts again. The authorities should take a stand on this as expatriates also contribute to the growth and prosperity of Dubai and they should not be treated or tourtured by these real estate middleman.

    anonymous, DUBAI, United Arab Emirates

  4. Added 15:05 May 2, 2013

    There are a lot of clauses on the tenancy contract as well, which the real estate agent makes us sign in a hurry. I was at Rocky Real Estate recently and I did sign one such contracts a couple of days before, and God knows, what's in store for me. I totally agree with one of the readers who stated that the landlords need to know that the salaries are not increasing and therefore the rent should be proportional too. And I totally feel that once the tenancy contract is signed the real estate firm should by no means be entertained. I hope the authorities will do something in this regard, so as to help us live peacefully.

    Srinath, Dubai, United Arab Emirates

  5. Added 14:31 May 2, 2013

    Never ending real estate tales.... I noticed minimal control from the authorities on these agents or landlords.

    Junoon, Doha, Qatar

  6. Added 14:18 May 2, 2013

    Individual tenants like us do not have the power nor the time to fight back against such agents, who seem to have no sense of decency. They can find a 1000 ways to bypass Rera laws, to maximise advantage for themselves and for their clients (private landlords.) I think the best solution is to rent directly from developrs like Nakheel and Asteco. This is what I will do next year, because I am fed up of being at the mercy of greedy agents and private landlords, who wish to make a killing again with their steep rent increases, now that the real estate market is shown to be recovering.

    Baria, Dubai, United Arab Emirates

  7. Added 14:12 May 2, 2013

    The Rera has blueprints of each building, incluidng their names and the total number of flats. Hence, price calculation should not be area wise, instead should be made on the building and flat-wise. This will make things easier for expats and owners alike.

    MRK, Dubai, United Arab Emirates

  8. Added 14:07 May 2, 2013

    Help us RERA!! These rental hikes are non-realistic. The economy is not that much booming to increase rents to 30-50%. Help us or we will be forced to move to sharjah or even Ajman!

    Fahad, Dubai, United Arab Emirates

  9. Added 14:03 May 2, 2013

    In the article I don't know why Nasser is worried. The landlord cannot forcefully evict him. He has the law on his side, he isn't due for a rent increase and the landlord hasn't given him three months notice by the Notary of Public letter either. He can simply tell the landlord that he will open a case with the Rent Committee if he does not get the renewed contract on the same terms. The fee is 3% of the annual rent and the tenant can open a case, but it will be the landlord who will be ordered to pay the amount when he loses.

    Craig2, Dubai, United Arab Emirates

  10. Added 13:51 May 2, 2013

    I am a Landlord and have few properties in Dubai. Would like to raise the following points: If the rent is too low then the owner should be given reasonable rental increase. If the tenant doesn't accept rental increase then he or she should accept one year vacating notice. Owners shouldn't increase rent in the second year. Agents please stop cheating or malpraticing with both owners and tenants just for the sake of few thousand dirhams. But yes upon renewal, agents should be given a basic service charge of at least Dh500 to Dh1000 for preparing the contracts, getting them signed and for handover of the cheques to the owner. It's their right. That's all. So everyone be gentle and make life easier and happy for everyone... Thanks

    Mahesh, Dubai, United Arab Emirates

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