Dubai’s real estate market has seen a rapid rise in rental prices over the past few years. As a tenant, it is essential to understand the regulations surrounding rent increases to protect your rights. This article will explore how much rent a landlord can increase every year in Dubai.
Understanding the Rental Increase Calculator
Dubai’s Real Estate Regulatory Agency (RERA) has implemented a rental increase calculator to regulate rent hikes. The objective is to strike a balance between landlords’ interests and the affordability for tenants.
Factors considered in the calculator:
- Current average rental rates in the area
- Type of property (residential or commercial)
- Number of years since the last rent increase
Rental increase caps:
According to RERA guidelines, a landlord can increase the rent for residential properties by a maximum of 20% if the current rent is below 25% of the average rent for similar properties in the area. If the current rent is between 26% and 35% below the average, the maximum increase is 15%. However, if the current rent is more than 35% below the average, the maximum increase is capped at 5%.
For commercial properties, the maximum rent increase is calculated differently. It takes into account the average rental rates in the area, the nature of the business, and the duration of the lease.
Notice Period for Rent Increase
Landlords in Dubai are required to provide a written notice to tenants regarding any proposed rent increase. The notice period must be at least 90 days before the end of the tenancy contract. If the landlord fails to give timely notice, the rent increase will not be enforceable until the next contract renewal.
Exceptions to Rent Increase Caps
While there are specific regulations to limit rent increases, some properties are exempt from these caps. Properties leased directly from the Dubai government or the Rent Committee, as well as properties in free zones, may not adhere to the standard rental increase rules. Landlords can negotiate rent increases freely in such cases.
As a tenant in Dubai, it is crucial to be aware of the rental increase regulations set by RERA. Understanding the rental increase calculator, notice periods, and possible exceptions will help you navigate the rental market and protect your rights as a tenant. Stay informed and ensure that any proposed rent increases comply with the guidelines set by the authorities.