Dubai: If you are renting an apartment or villa in the UAE, how often can your landlord increase the rent? And is there a cap on how much the rent can be increased by? The answer depends slightly on the emirate in which the residential unit is located. Here is what you need to know about rent increases in the emirates of Dubai, Abu Dhabi and Sharjah.
Dubai
According to Shishira Johny, Corporate and Commercial associate at The Legal Group, Decree No. (43) of 2013 ‘Determining Rent Increase for Real Property in the Emirate of Dubai’ lays down the percentages of rent increase permissible by the law, under Article 1.
Shishira Johny, Corporate and Commercial associate at The Legal Group
The Decree states as follows:
a) if the rent of the real property unit is up to 10 per cent less than the average rental value of similar units, then the landlord shall not increase the rent;
b) if the rent of the real property unit is 11 to 20 per cent less than the average rental value of similar units, then the landlord may increase the rent maximum by five per cent of the rent of the real property unit;
c) if the rent of the real property unit is 21 to 30 less than the average rental value of similar units, then the landlord may increase the rent maximum by 10 per cent of the rent of the real property unit;
d) if the rent of the real property unit is 31 to 40 per cent less than the average rental value of similar units, then the landlord may increase the rent maximum by 15 per cent of the rent of the real property unit;
e) if the rent of the real property unit is less than the average rental value of similar units by more than 40 per cent, then the landlord may increase the rent maximum by 20 per cent of the rent of the real property unit.
“In this case, the average rental value of similar units would be determined in accordance with the Property Rent Index of the Emirate of Dubai,” Johny said.
You can access the rental index by Dubai Land Department here: https://dubailand.gov.ae/en/eservices/rental-index/rental-index/#/
Abu Dhabi
In Abu Dhabi, the Landlord and Tenant Law allows the landlord to increase the rent by a maximum of five per cent of the existing rental amount. If the landlord increases the rent beyond this cap, a tenant may refer the matter to the Abu Dhabi Rent Committee for determination of the rent.
Hari Wadhwana, an Associate at Dubai-based law firm OGH Legal, said that Abu Dhabi Law No. 20/2006 deals with the Landlord Tenant Relationship in the Emirate of Abu Dhabi.
Hari Wadhwana, an Associate at Dubai-based law firm OGH Legal
"Article 16 of the said law provides that the Landlord may increase rent on an annual basis for no more than five per cent of the current rent. Tenants of course have a remedy to approach the Rent Dispute Committee if he or she believes the increase is arbitrary or over five per cent of the statutory limit," Wadhwana said.
Sharjah
As per 2007 tenancy laws of Sharjah, renters are protected from annual rental hikes, where Sharjah’s tenancy laws of 2007 protect tenants from annual rent hikes.
"The legislation does not deal with the percentage of rent increase. However, in case of any disagreement between the landlord and tenant, the Rent Dispute Committee will determine the rent, which would be pursuant to the market value," Wadhwana said.
Ajman
Ajman Emiri Decree No. 2/2017 deals with the Landlord Tenant Relationship in the Emirate of Ajman.
"Article 6 of the said law provides that the the landlord cannot increase the lease amount for a period of three years from the date of lease contract or the last instance where the rent was increased. Further, for the Landlord to increase the rent, he must send a written notice at least two months in advance of expiry of the lease contract and the increase in rent cannot be more than 20 per cent of the current rent. Independently, the Landlord may approach the Rent Dispute Committee to increase the rent beyond 20% and in exceptional circumstances, the committee may grant approval," Wadhwana said.
