When the renewal date of a tenancy contract looms, it can leave many residents feeling anxious. Then when the notification comes, often with a big increase in rent if current rental rates are anything to go by, it can leave a tenant reeling. However, there are steps you can take to bring that rent down to a more acceptable level:
Phone your agent or landlord and politely explain that the rent being demanded is too high. Remind them why you are a good tenant, i.e. you look after the property; have it regularly maintained; keep it clean and tidy; always pay on time and so on.
If you are able to have direct access to your landlord, use any rapport or common ground you have with him or her to your advantage. Landlords are always much more accommodating if they like their tenants and feel they are going to take care of their investment.
You could even invite your landlord around for a coffee or tea meeting in the home so that they can see for themselves how well it is being maintained. Then, once you are on common ground, you can negotiate and try and find a rental figure that works for you and the landlord.
#2: If the friendly approach fails, then go official
The Real Estate Regulatory Authority (RERA) has a rent calculator on the Land Department’s website, which will help you ascertain if your landlord is trying to charge you too much.
Landlords may raise rents for sitting tenants on a sliding scale, depending on how far the existing rent is below RERA’s geographic rent index, which is updated by RERA three times a year.
To work out if the increase demanded by your landlord is too high, put your current rent into the calculator along with the location and size of your property and the calculator will work out if an increase is due and if so how much.
It bases its analysis on the average rent rather than the market rates the real estate agents like to talk about. The most important thing to remember is that rents that are less than 25 percent below the index figure may not be raised at all.
A rent that is over 25 percent lower than the market rate means the landlord can increase the rent. How much, however, is made clear by RERA. There is an increase of 5 percent if the rent value is 26 to 35 percent below the average – this is a pattern that keeps going up until the difference between the average and the amount you pay is 55 percent. In those instances the rent should go up by 20 percent – the maximum increase any landlord can make.
Once you know the rules, reply to your agent or directly to your landlord and make it clear you will only pay an increase as per the RERA law. That might be enough to stop your landlord in their tracks – particularly if their rental demand is outside the RERA regulations. But it might not stop everybody.
#3: Get the law involved
If the landlord ignores your request to stick within the RERA guidelines, then you need to raise a case against your landlord.
Filing a complaint with the Dubai Land Department’s Rental Dispute Settlement Centre will cost you, though, as it attracts a fee of 3.5 percent of the annual rent. Calculate if the discrepancy between you and your landlord is more than that before you proceed, especially as there may be other fees involved, such as payment of an expert’s fee.
DMRC has been given jurisdiction over all rental disputes and, as the plaintiff, it is up to you to raise the case. Once their decision is made, it is final and binding and cannot be appealed in the Dubai Courts.
Remember, in order to raise a case, you need to have registered your tenancy contract with Ejari, which means ‘my rent’ in Arabic. While it’s really up to your landlord to do this, if you don’t have a good relationship it’s worth doing yourself. You need the title deeds of the property, a copy of your passport and the original tenancy contract. Take these along to any typing centre that handles Ejari or to the Dubai Municipality itself; the process will cost AED 195.
The other thing to consider, before you raise a case, is that while in the past the law gave tenants a two-year protection against any increases, that has now changed. The amended law now states that the rent can increase every year, however, this is only as long as it falls in line with RERA’s rental index.
Finally, once the new rent is agreed upon, you then need to consider how you are going to pay for the year ahead. There are a number of personal loans designed specifically for tenants so shop around and compare all the options on the market.