UAE | Housing & Property
Rent raises come into focus as 15% cap rule ends soon
Some landlords here are raising rents by another 15 per cent before the existing rent cap comes to an end in four days.
- By Ashfaq Ahmed, Staff Reporter
- Published: 23:36 May 3, 2009
- Image Credit: Gulf News archive
- The 15 per cent rent cap was implemented by the Dubai Government on November 11 last year.
Dubai: Some landlords here are raising rents by another 15 per cent before the existing rent cap comes to an end in four days.
The 15 per cent rent cap was implemented by the Dubai Government on November 11 last year and it will end on December 31.
The order says rent increases, either by property leasers or landlords, should not exceed 15 per cent of the annual rent.
A Gulf News survey revealed that a number of landlords or real estate companies which increased rents by 15 per cent early this year, have once again given notices to tenants for another 15 per cent increase as the year comes to an end.
"I got a notice of another 15 per cent increase last week despite the fact my house lease renewal is due in January. Landlords are taking advantage of the situation and want to increase rents before the 15 per cent cap comes to an end," said M. Hussain, who got a second rent increase notice this year.
Committee's assurance
An official at the Dubai Rent Committee said: "The 15 per cent rent cap condition will come to an end on December 31 because so far we have not received any orders from the government regarding this issue."
He said the 15 per cent rent cap helped curb the 'rent race' in the market.
Tanveer Khan, a property consultant, said the rent cap helped both tenants and landlords but it also led to a sharp increase in the base rents for the new tenants in any area.
"Landlords increase the base rents by 50 to 100 per cent to make up for coming two to three years because they know that they won't be able to increase rents by more than 15 per cent until December 31," he said.
An official at the Dubai Rent Committee told Gulf News that complaints regarding rent increases can be submitted at the committee office at the Dubai Municipality main office on Baniyas Road.
A complainant has to pay 3.5 per cent of his annual rent as fee to the committee. If a tenant wins the case the fee is adjusted with the rent.
Under the existing rule, 15 per cent is the maximum rent increase permitted. If a tenant does not agree even on the 15 per cent increase, he can contact the rent committee and file a formal complaint.
The committee sends its team to the building and then determines whether the 15 per cent increase is justified. The official said tenants should not fear landlords because their rights are well protected.
"No landlord can evict tenants without any solid reason which is non-payment of rent or other complaints. Even for eviction, the landlord has to file a case with the rent committee to decide whether he is justified," said the rent committee official.
Your comments
You should allow people to start living in caravans like Bedouins.
Kumar
Delhi,India
I feel the rents should go down now, as the supply is more than demand and the scenario on freehold has also changed. It should be reduced by all means!
S V Govind
Dubai,United Arab Emirates
The report regarding the rent hike is not satisfactory. It would be helpful if the following items were also considered square feet, location, other facilities provided such as security, age of building etc.
Subhash T
Dubai,UAE
It is ridiculous; some stern action needs to be taken. We have come to Dubai to save but we are spending all our money in rent.
Amnafayyaz
Dubai,UAE
People cannot afford such an increase in rent as the landlords are increasing it day by day. People are suffering a lot due to this increase.
Shilpa S Pai
Dubai,UAE
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