UAE property: ‘Can a landlord increase rent with 30 days' notice?'

The landlord and tenant signed an addendum that allowed a notice period of one month to make contract alterations

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I own an apartment in Dubai where I have had a tenant for two years and they are about to start their third year of tenancy.

In the second year of the lease, my tenant asked me not to increase the rent and I agreed. However, they made the same request this time around.

The Real Estate Regulatory Agency (Rera) rent calculator stipulates a permissible rent increase of between 13 per cent and 32 per cent for properties in the area.

I had added an addendum in the rental contract that a one-month notice needs to be served to make any changes in the terms and conditions of the agreement. The tenant had also signed this document.

I served notice for a 23 per cent rent increase 47 days before the contract expired.

However, my tenant has not agreed to the higher rent because he claims I did not serve 90 days’ notice before the lease expired. What do I do? IM, Dubai

There are two things to consider in your case: firstly, your contract and secondly, what the Dubai rental laws state.

Let’s consider your rental contract first. You have signed an agreement that outlines the agreed terms and conditions.

Because both of you agreed to the one-month period for any changes to the contract renewal and/or withdrawal of the agreement, this is fine to a point.

But if one of the parties (in this case your tenant) decides not to abide by what is agreed, the second point may come in to play: what the law states is allowed.

The fact that your contract goes against what the rental laws permit should not necessarily be a factor, given two parties agreed to it.

But when one of the parties change their mind, the alternative would be for the tenant (or you) to file a case at the Rental Dispute Settlement Committee (RDSC) to reach an agreement.

The judge at the RDSC will decide if your contract takes precedence or the law does. It really is a 50-50 scenario, so I cannot give you any guidance as to the likely outcome.

The same is true for the rental increase, which is allowed given what the Rera rental calculator states.

But it’s all about the timing of the notice. Once this is sorted, it will also determine whether you can proceed with the rental increase or not.

I live in a rented apartment in Dubai and am in the 11th month of the first 12-month contract.

As we had no communication about a rental increase within the 90-day period before renewal, we assumed the lease would be automatically renewed. When we inquired, we were told that a new landlord was buying the apartment.

However, the new landlord contacted us to say they are moving in and served us with a three-month eviction notice. This was via email.

Doesn’t the new landlord need to provide proof that he wants to live in the property or is he assuming in good faith that we will move out? BC, Dubai

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A rental contract automatically renews under the same terms and conditions as before if there is no communication between the parties to the contrary.

Assuming you want to renew the lease for the coming year and since the 90-day window of notice has passed, the landlord is obliged to renew under the same terms and conditions as before.

Even if the property is sold, the new owner takes over the property and your tenancy agreement as is and can only make alterations to the contract after serving 90 days’ notice from the renewal date.

If the new owner buys the property for his own use or use of his next of kin of first degree, then he must send you a 12-month eviction notice stating this reason. This notice must be sent via notary public or registered mail.

Therefore, you will be entitled to remain in the property for at least one more year at the same rent and on the same terms and conditions as before.

Mario Volpi is the sales and leasing manager at Engel & Volkers. He has worked in the property sector for more than 35 years, in London and Dubai. The opinions expressed do not constitute legal advice and are provided for information only. Please send any questions to mario.volpi@engelvoelkers.com

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Updated: October 27, 2022, 4:00 AM
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