Can Dubai property agent demand Dh2,000 rent renewal fee?

Is an agent's Dh2,000 fee to renew a tenancy contract reasonable, when Rera recommends agents only charge a maximum of Dh160? Mario Volpi advises.

Mario Volpi advises on the latest property issues. Jeffrey E Biteng / The National

I live in Business Bay and am in the process of renewing my rental contract for the second year. However, my landlord's agent is now asking for Dh2,000 for renewal charges. According to him these charges are in line with Rera. I have not agreed this previously and the current contract says nothing about fees being payable on renewal. So does the agent have the right to charge this? I understand that landlords should pay this fee, not the tenant, but the agent is basically forcing us to pay before renewing the contract. OM, Dubai

This topic of renewal fees is quite contentious. If you check with Rera, they will tell you that renewal fees should not be charged but if they are, they should be no more than Dh160. My opinion is different. If you are engaging with an agent in the renewal process, then there is a certain amount of work that they need to do. This process is not done free of charge and I believe Dh160 would not cover the administrative costs anyway. I realise that in your case, you appear not to have a choice as the agents are requesting this if you wish to renew. Their renewal charge does seem high though, as the industry norm falls between Dh500 to Dh1,000 to effect a renewal. Higher than this would seem that they are trying it on. Try to negotiate with them but if this fails, I suggest that this cost be shared with the landlord too.

If the landlord is a company and not a private owner, how can he evict us based on the fact he will occupy the property? Who has the right to occupy the property in this case? The chief executive of the company or any employee? AS, Dubai

If the property is owned in the name of a company, ultimately the owners of that company can appoint whoever they choose to live in it. However, this is up to a point. The law states that an owner or his immediate next of kin can request eviction of a present tenant if they wish to use the property themselves. The law is silent, however, when it comes to how far down the line (in this case employees) this would be applicable to. I realise that my answer potentially raises more questions than answers for you, but I can only state that if you wish to contest any potential eviction, you can file a case at the rental committee to ultimately get your definitive answer. Obviously though, this will come at a cost.

I bought a studio apartment in September 2015 and the tenant has told me about an issue with a balcony sliding door. He has been living in that apartment for the last two to three years and wants me to get the door fixed now. Since he has been living in the apartment for a while, should this be done by him or should he have got it done through the previous landlord if this issue has existed for a long time? He is threatening me with legal action if I don't get it fixed. Is it my duty to do such minor maintenance? GA, Dubai

In most tenancy agreements, there should be addendums that outline further information which confirm responsibilities between landlord and tenant. Maintenance is one of those points, and the general consensus is that major maintenance is the responsibility of the landlord while minor work is the responsibility of the tenant. Major and minor is often differentiated by a monetary figure, for example Dh500-Dh1,000 for minor, with more than this amount deemed as major. This way, it is clear as to who ought to be responsible for repairing or maintaining a problem. You say that the present tenant has been living in the apartment for two to three years, but it is possible that the issue with the sliding door could have just happened recently. Either way, as the owner, it is now your responsibility to sort out. If you do not have a specific arrangement in place, now would be an ideal time to sort out an agreement for the future. I suspect that the solution to this will lie with your negotiation skills. I doubt a tenant would bother to take legal action against you, as the cost of processing a case will be uneconomic when compared to the repair cost of the initial problem.

Mario Volpi is a real estate professional who has worked within the industry for the past 31 years in London and Dubai. The opinions expressed in this article are those of the author and they do not reflect in any way those of the institutions to which he is affiliated. It does not constitute legal advice and is provided for information only. Please send any questions to [e-mail].

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