Dubai landlords free to hike rents by 20pc
Dubai, December 22, 2013
Landlords in Dubai will be able to increase rents by up to 20 per cent under a new decree issued by Dubai ruler Sheikh Mohammad Bin Rashid Al Maktoum, said a report.
This new rule overrides the 5 per cent rental cap announced earlier and sets out new maximum rent increases for tenancy contracts renewals, reported the Arabian Business.
Under the latest real estate sector reforms, rent rises can kick in when a property hits 11 per cent below market value for an area. If it is between 11 percent and 20 percent lower than the average rent for a similar property, a landlord can increase the rent by five per cent, said the report citing a WAM agency statement.
The maximum increase can be 10 per cent if the property falls 21 per cent to 30 per cent below market rates and 15 percent if the property is 31 per cent to 40 per cent under average rents, said the report.
However, Dubai properties which are more than 40 per cent below average rents for similar properties in an area could be subject to rent hikes of up to 20 per cent, it added.
“The decree applies to landlords from the public and private sectors in the emirate of Dubai, including private development areas and free zones,” said the report.