Landlords often use a deposit to return the property to the same condition it was at the start of the tenancy. Getty
Landlords often use a deposit to return the property to the same condition it was at the start of the tenancy. Getty
Landlords often use a deposit to return the property to the same condition it was at the start of the tenancy. Getty
Landlords often use a deposit to return the property to the same condition it was at the start of the tenancy. Getty

UAE property: ‘My landlord overcharged me for property damage’


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Question: My family and I recently moved out of an apartment in Sharjah that we had rented for 10 years.

However, the property manager sent me an overpriced bill under the pretext of fixing damages in the apartment.

Are landlords or the building management legally entitled to charge for the repair of the property after the tenant moves out?

If I do not pay the charges immediately, they are threatening to file a case against me. EB, Sharjah

Answer: When a tenant enters into a rental contract with a landlord, a deposit is lodged and is used to repair any damage that occurred to the property during the period of the tenancy.

The deposit is also often used to return the property to the same condition as it was at the start of the tenancy.

What appears to be at play here is not the fact that the landlord is charging you for all the items listed, but I presume the individual cost of each item is what is causing you concern.

Therefore, I recommend you try to negotiate this downwards, if possible, by suggesting that you can organise the repairs or any replacement(s) yourself.

Q: I rent a property whose previous owner issued a 12-month eviction notice last year based on his intent to sell the unit.

The property was sold and transferred to the new owner a few months ago.

I recently informed the new owner of my intent to continue the lease. I made my notification within the 90-day period before lease expiry.

The new owner insists that the eviction notice issued by the previous owner last year carries over to the new landlord as well.

As a result, the new owner is demanding that I leave the property at the end of the current lease, citing their intent to occupy the unit.

I am certain that the new owner must issue a new 12-month notice to vacate since the reason for eviction (to occupy) is different from the previous owner’s reason (to sell).

It is also my understanding that the owner must provide evidence to the Real Estate Regulatory Agency that they do not have another suitable property.

Is the new owner required to issue a new 12-month notice to vacate or does the former owner’s notice still apply? DN, Dubai

A: Your understanding is correct when it comes to eviction notices, but I can see how sometimes individuals take certain stances when interpreting the law.

What I can tell you is that when a landlord gives a 12-month notice to his tenant for reason of sale, and then the buyer turns out to be an owner-occupier, it has been shown that some judges at the Rent Dispute Settlement Committee directly request the new owner to send their own 12-month notice to vacate.

If there is a difference of opinion, as there is with you and your new landlord, the only way to resolve it is to file a case at the RDSC and let the judges decide.

The law does request that the burden of proof is with the new owner to prove they do not own another suitable property that could be used instead.

Mario Volpi is the sales director at AX Capital. He has worked in the property sector for 39 years in London and Dubai. The opinions expressed do not constitute legal advice and are provided for information only. Please send any questions to m.volpi@axcapital.ae

Mercer, the investment consulting arm of US services company Marsh & McLennan, expects its wealth division to at least double its assets under management (AUM) in the Middle East as wealth in the region continues to grow despite economic headwinds, a company official said.

Mercer Wealth, which globally has $160 billion in AUM, plans to boost its AUM in the region to $2-$3bn in the next 2-3 years from the present $1bn, said Yasir AbuShaban, a Dubai-based principal with Mercer Wealth.

Within the next two to three years, we are looking at reaching $2 to $3 billion as a conservative estimate and we do see an opportunity to do so,” said Mr AbuShaban.

Mercer does not directly make investments, but allocates clients’ money they have discretion to, to professional asset managers. They also provide advice to clients.

“We have buying power. We can negotiate on their (client’s) behalf with asset managers to provide them lower fees than they otherwise would have to get on their own,” he added.

Mercer Wealth’s clients include sovereign wealth funds, family offices, and insurance companies among others.

From its office in Dubai, Mercer also looks after Africa, India and Turkey, where they also see opportunity for growth.

Wealth creation in Middle East and Africa (MEA) grew 8.5 per cent to $8.1 trillion last year from $7.5tn in 2015, higher than last year’s global average of 6 per cent and the second-highest growth in a region after Asia-Pacific which grew 9.9 per cent, according to consultancy Boston Consulting Group (BCG). In the region, where wealth grew just 1.9 per cent in 2015 compared with 2014, a pickup in oil prices has helped in wealth generation.

BCG is forecasting MEA wealth will rise to $12tn by 2021, growing at an annual average of 8 per cent.

Drivers of wealth generation in the region will be split evenly between new wealth creation and growth of performance of existing assets, according to BCG.

Another general trend in the region is clients’ looking for a comprehensive approach to investing, according to Mr AbuShaban.

“Institutional investors or some of the families are seeing a slowdown in the available capital they have to invest and in that sense they are looking at optimizing the way they manage their portfolios and making sure they are not investing haphazardly and different parts of their investment are working together,” said Mr AbuShaban.

Some clients also have a higher appetite for risk, given the low interest-rate environment that does not provide enough yield for some institutional investors. These clients are keen to invest in illiquid assets, such as private equity and infrastructure.

“What we have seen is a desire for higher returns in what has been a low-return environment specifically in various fixed income or bonds,” he said.

“In this environment, we have seen a de facto increase in the risk that clients are taking in things like illiquid investments, private equity investments, infrastructure and private debt, those kind of investments were higher illiquidity results in incrementally higher returns.”

The Abu Dhabi Investment Authority, one of the largest sovereign wealth funds, said in its 2016 report that has gradually increased its exposure in direct private equity and private credit transactions, mainly in Asian markets and especially in China and India. The authority’s private equity department focused on structured equities owing to “their defensive characteristics.”

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Updated: June 01, 2023, 4:00 AM