Question: I have been living in a rented apartment in Dubai for one year. Last week, I received an email from my landlord notifying me of an increase in rent, which is in line with what the Dubai Land Department’s rental calculator states is permissible.
However, the email states that I will have to pay for all maintenance issues during the term of the new lease.
This is an old building which needs to be renovated and maintenance problems come up all the time in my apartment.
Is it fair and legal for the landlord to put the onus of paying for maintenance on the tenant? If not, where can I lodge a complaint? I’d like to continue living in this apartment. Please advise. SK, Dubai
Answer: The landlord is responsible for the maintenance and upkeep of his property. However, there is an industry norm that for certain maintenance issues the tenant also shares this responsibility.
For ease of understanding between landlords and tenants, most tenancy contracts are written with the following clauses agreed upon: in the event that any minor maintenance issues that need attention and amount to less than Dh500 ($136), the tenant shall bear the cost and deal with the issues themselves.
For any maintenance issues above Dh500, this then falls upon the landlord to take care of and pay for the work needed to rectify the issue. You should inform the landlord that this is the norm and that having the complete maintenance on your shoulders is not correct.
Assuming he doesn’t agree and you also do not agree with having to pay for all of the maintenance going forward, I can only suggest you file a case at the Rental Dispute Centre and let the judge of the day decide upon a fair outcome.
This will cost you 3.5 per cent of the rental amount to open the case but often this charge is also awarded as costs to any winning party.
Q: I have been living in the UAE for many years. I earn a limited income but am keen to invest in the property sector.
What are a few options for someone like me to earn an income from property as an asset class in the UAE?
Would you recommend fractional property ownership? What are the disadvantages of this ownership model?
Are rent-to-own schemes still available in Dubai? What are the pros and cons of this model?
What about real estate investment trusts? Is this recommended for the average retail investor?
I’d like to know your thoughts on this subject. MM, Abu Dhabi
A: Without knowing exactly how much your earnings are or how much disposable income you have, it’s difficult to properly advise on what’s best for you but I will try to answer your questions.
The fractional ownership route would most likely be your best option. There are several companies that offer this, but one of them is called Prypco Blocks. The advantages of this are that you will be able to buy a portion of the property by investing as little as Dh2,000, you can earn monthly income from any rentals it may attract and, of course, any future growth through capital appreciation.
You can diversify by adding to your investment at any time, but one of the disadvantages would be that you would only be able to sell after a period of time has elapsed, so this may not be convenient if you needed to sell quickly.
The rent-to-own schemes are also a way of getting on to the property ladder, but you will need to invest much higher amounts than the fractional ownership route. They are a great way to live in a property while trying to raise enough of the deposit to then be able to get the rest of the funds to buy the property via a bank mortgage.
Unfortunately, there are not so many of these options available to the public due to the nature of the present market. These were popular a few years ago when the market was less buoyant.
Real estate investments are very much like fractional ownership and can be a great way to enter the market and also diversify the portfolio by owning small percentage portions of the unit.
Anyone can invest in this option but my advice is to shop around and always do your due diligence to find out what’s best for you in terms of all the factors, especially when wanting to exit.
Mario Volpi is head of brokerage at Novvi Properties and has worked in the property sector for 40 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@novviproperties.com
