Dubai’s booming property market is causing problems for some people. The recent increase in prices has led to a rise in legal disputes between landlords and tenants.
This is because some tenants are facing large rent increases and even illegal evictions. This comes after Dubai’s economy bounced back strongly following the COVID-19 downturn.
Many residents now find their rents skyrocketing. And, in some cases, landlords, seeking to cash in on this property boom, are evicting tenants unlawfully. This has resulted in a growing number of tenants taking legal action against their landlords, often seeking up to a year’s worth of rent after being kicked out.
Dr. Hassan Elhais from Al Rowaad Advocates stated that the Dubai Land Department’s Real Estate Regulatory Authority (RERA) is overwhelmed with complaints from tenants. Some landlords are even trying to hike rents by 50 percent just to renew contracts.
As per the regulations in place, landlords are permitted to increase rents by up to 20% per year, based on the local market rate.
Although the maximum rent increase is limited by law, landlords can charge more if both parties agree. This has led some landlords to evict current tenants so that they can charge new tenants even more.
During the pandemic, most rental disagreements were about missed rent payments, as many faced financial hardships. Now, the main bone of contention appears to be rent hikes during lease renewals and landlords evicting tenants.
Al Arabiya English, after attending a RERA session, reported seeing a sea of people awaiting their turn before a judge. Many expressed anger over being wrongfully evicted.
Dr. Elhais noted that Dubai’s rental contracts often allow for yearly rent increases. Disputes can arise if tenants see these hikes as unfair or landlords do not follow proper legal steps for raising rents.
He clarified that evictions can only occur in certain circumstances, such as non-payment of rent or a breach of the lease agreement. Tenants who believe they have been wrongfully evicted can contact the Rent Disputes Settlement Centre (RDSC) for possible compensation.
Landlords are also required to give a 90-day notice for any changes in the rental contract, including rent hikes. If they do not, tenants can legally reject the increase.
If a tenant disagrees with the new contract terms, they can take the case to the RDSC. However, they would have to pay 3.5% of their annual rent to open the case, up to a maximum of $5,450.
Max hike of 20% rents is not a fair outcome post covid. There should be a balanced hike to allow a gradual growth. No one has got a 20% hike in salalries post covid? So how can one match the expense hike at 20% for rents?