If you’re a tenant in Dubai, you’ve probably heard about the decline in residential rents over the past year. Property reports have further signaled that the rental market is expected to stay stagnant all through 2017. If you still haven’t managed to convince your landlord to drop your existing rent, now’s the time to put your bargaining skills to the test!
We’ve shortlisted five practical negotiation strategies that could work in your favour, and hopefully you would end up taking home a revised rental agreement that’s much easier on your pocket.
Let the Rent Index be your guide
The Dubai Land Department manages and updates the Rent Index, which serves as a reference point for both tenants and landlords. The index shows the average annual rents for all residential and commercial areas in Dubai. The Rental Increase Calculator tells you whether your rent is eligible for a hike, and if so, by what maximum percentage. If you’re hoping to get your rent reduced, make sure you stay abreast of the changes in the Rent Index.
For example, the most recently updated rent index shows that annual rents for two-bedroom apartments in Dubai Marina have dropped from a range of AED 140,000-180,000 to AED 120,000-160,000.
[Related: Renting in Dubai? Costs to keep in mind]
Scout the market for current rental expectations
It is just as important to be aware of the rental market sentiment within your community, as it is to be aware of the macroeconomic aspects affecting the rents in your city and country. So if property reports highlight your locality as one of those that’s witnessing the highest drop in rents, how about you do a bit of your own research too? Check online property portals and call real estate agents to get an idea about the highest and lowest rents in your apartment complex or villa community, or if there are any new construction/infrastructure plans proposed in or around the area. It would be smart to be armed with these statistics when you approach the landlord.
Take your bargaining skills ‘outside the box’
So you’ve checked the rent index and the average rents in your community and as it turns out, your current rent is not really that high – What do you do now? There are still other ways you could ride the wave of falling rents, if you simply shake up your bargaining strategy.
How about reducing the number of cheques from four-a-year to two or three a year? Or you could even suggest paying a deductible for all repairs and maintenance costs? Want to stretch your imagination even further… How about giving up your parking space if you don’t own a car?
Demonstrate your value as a tenant
Just as a tenant you don’t want to end up with a ‘ nightmare’ landlord, even landlords are wary of ending up with bad tenants. So make it known to your landlord that you’re one of the good ones.
By ensuring proper maintenance and upkeep of the property, not damaging any fixtures around the house, cooperating with the landlord when required, and expressing your interest in a long-term tenancy tenure, you’ll prove that you’re reliable and deserve a fair rental reduction, given the current market conditions.
If nothing else works, threaten to leave
If all other negotiation tools fail, you can inform your landlord that you’re serious about not renewing the contract. But make sure the timing is right when you do so – If market rents have been stagnant or are falling, this might spell bad news for the landlord. By letting you go, he would risk having the house unoccupied for an uncertain period of time, losing rental income in the interim. And if he manages to find a tenant, there’s the risk of having to rent out the property at a lower rent.
But watch out, this could backfire just as easily. In a market scenario where average rents are higher than what you’re currently paying, this could be the ideal window of opportunity for your landlord to lease the property out at a higher rent.