Steep Dubai rent hikes as landlords tell tenants to 'pay or pack-up'

Published Sunday, October 14, 2012

By Parag Deulgaonkar

Optimism and growing enquiries for rental properties in Dubai are pushing landlords to arbitrarily increase rents, ignoring the rental calculator set up by Dubai’s Real Estate Regulatory Agency (Rera) for the purpose.

Tenants living in Jumeirah Lakes Towers, Discovery Gardens and the Springs, called 'Emirates24|7' to report the tactics adopted by landlords, who have either increased rents even though they are not entitled to, or have simply asked them to vacate.

B Brian, who stays in Discovery Gardens, told this website: “My landlord has hiked my rent by Dh6,000. I am currently paying Dh39,000 for a one-bed, while the Rera rent calculator shows no increase.”

Rera puts the rent for one-bedroom apartments in Discovery Gardens in the range of Dh35,000 to Dh40,000 per year.

It says that if the rent is less than or equal to 25 per cent of the average similar rent in the area and so there should not be any increase of rent.

Brian says: “My landlord told me to pay or leave since his agent has already found someone who was willing to pay Dh45,000 in two cheques.”

Adrain Green lives in a studio apartment in Jumeirah Lakes Towers. His lease expires in December.

“My landlord’s agent has informed me that my rent will be increased by Dh5,000 in the next contract.

“I can’t pay that much, but as I want to avoid shifting hassles I have conveyed to him that I was willing to pay five per cent more even though the official rent calculator showed no hike.”

Geen says he still hasn’t heard from the agent, but isn’t contemplating leaving the apartment as the landlord has to serve him two-month notice.

Rent for studio apartments in Jumeirah Lake Towers are in the range Dh30,000 to Dh45,000 per year, Rera calculator reveals, adding the tenant isn’t entitled to any rent increase.

Abhay Salunke leased a two-bed villa in the Springs for Dh87,000 in 2011, but his landlord has asked for an increase of Dh13,000 in the new contract, or else to vacate the house.

“My landlord wants me to pay Dh100,000 per year. He has asked me to pay or leave. A 15 per cent increase is obnoxious. I am not going to pay that for certain and I am not going to leave without fighting,” he informed.

Knight Frank's latest Prime Global Rental Index, reveals rents in prime neighbourhoods up by two per cent in the second quarter this year compared to the first quarter, while year-on-year it rose by 3.3 per cent.

In July, Jones Lang LaSalle (JLL) said rents for villas and apartments in established communities and prime buildings across Dubai rose 10 per cent and nine per cent, respectively, in the second quarter 2012 compared to the same period last year.

“While villa rents have increased five per cent compared to the levels of January 2009 and are almost back to their peak levels, apartments are 30 per cent lower relative to January 2009 levels,” the global consultancy said.

Maintaining a buoyant view on the realty market, JLL stressed rents and prices will continue their upward trend during the remaining of 2012.

Click to read Dubai Rent Decree

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