Up up and away: Many expats staying in Mussaffah have received notices about the spike in rentals for the coming year Image Credit: XPRESS/Zarina Fernandes

Abu Dhabi: Residents of Mussafah are feeling the heat of arbitrary rent hikes following removal of the five per cent annual rent cap in Abu Dhabi.

Many expat families staying in Mohammed Bin Zayed City – a sprawling residential and commercial area in Mussafah - said they have already received rent hike notices for their renewal.

“My rent is increasing from Dh45,000 to Dh65,000 in March. Our landlord has asked us to either pay more or look for another place,” said Hemanth Kumar, an Indian expat who lives near Safeer Mall.

The civil contractor who stays in a one-bedroom apartment with his wife and five-year-old daughter said he moved to Mohammad Bin Zayed city two years ago because of cheaper rents.

“I cannot pay Dh65,000 in rent annually. I will have to look for a smaller house,” said Kumar.

Karunan Chinnaswamy, an electronics engineer from India, said he has been asked to pay Dh35,000 more for his two-bedroom apartment.

“I pay Dh55,000 for my two-bedroom apartment. My renewal is due in February and the landlord has told us verbally he is increasing the rent to Dh85,000.” said Chinnaswamy. “That is a whopping increase of more than 50 per cent.”

Many residents are facing similar predicaments after the Abu Dhabi government announced the removal of the rent cap last November 10.

In the absence of any restriction on the percentage of a rent increase, landlords have the sole right to decide rents.

Commercial outlets

Commercial establishments are also hit hard by the rent cap removal. Firoz Ahmad of Izhar Dress Pressing Shop behind Maryland School in Mussaffah said his shop rent has gone up from Dh25,000 to Dh35,000.

Iqbal Kunji, who runs a grocery nearby, thinks a big rent hike will hit him hard as he is yet to recover from the Dh150,000 investment he made to renovate his grocery.

Many expat families who have not yet received any notification from their landlords said they are worried.

“It is like living in a state of constant fear. We know rent hikes are coming, but cannot guess by what percentage,” said Ayoub Khateeb, an Egyptian expat who currently pays Dh62,000 for a two-bedroom apartment.

A semi-government employee, Khateeb said he was hoping that government authorities would bring some sort of regulation to arbitrary rent hikes.

“There are landlords who own just one or two buildings. But there are big players who have 25 to 30 buildings. They can easily dictate market prices by a uniform rent increase in their properties,” he said.

“For many landlords this is an opportunity they were waiting for. A 10 to 15 per cent rent increase is needed for some properties to be on par with current market rates,” said Manoj, a property dealer with first Chance Real Estate.

Currently, a one-bedroom costs from Dh50,000 to Dh65,000, depending on the size and locality. Until a year ago it was available for Dh45,000 to Dh50,000.

The average rent for a two bedroom apartment in Mussafah is more than Dh70,000 now. Two years ago these apartments were available for less than Dh55,000.

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