I have lived in the same three-bedroom Springs villa in Dubai for 11 years and pay a low rate compared to many because I have been there for so long. My landlord has put up the rent by 7 per cent every year for the last four years - partly, I assume, to bring me back in line with rents elsewhere in the community. But I see a lot of empty units at the moment and have noticed prices dropping. While the figures quoted are not as low as mine, if they keep dropping and my rent goes up by another 7 per cent this year, I will start to be more in line with market rates? Should I contest the 7 per cent rise when it comes in December? And do you think rents will drop further in the area? TL, Dubai
The first thing to remember is that if a landlord wishes to change the contract's terms and conditions, he has to do it in writing giving 90 days notice prior to the expiry of the agreement. If this window is missed, no changes will be allowed as per the law.
If the changes are within the 90-day window and you do not agree with them, in this case a rental increase, you are at liberty to reject them and move to alternative accommodation. The key here is communication. Clearly the landlord is not interested in having his villa unoccupied, so he ought to be realistic in his approach with you as the existing tenant. That said, he is merely exercising his right to ask a fair rent if that be the case at the time. If by December, you believe you can get a similar property but at a cheaper rent elsewhere, this has to be communicated to the landlord. Remember that you will also have to take into consideration the associated moving costs including the disconnection of the utilities and reconnection charges, etc. These hassle factors will also have a bearing on your decision.
My advice would be to perhaps stick it out for one more year, even if the next rent will be more or less the market rent.
With reference to your second point, it is true that there continues to be downward pressure on rents, so I suspect that come December, your landlord might find it difficult to raise the rent by another 7 per cent. The outcome, however, is down to your negotiation skills and these will depend on the type of relationship you have with the landlord.
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Dubai rental prices:
Where Dubai villa rents have risen and fallen, Q2 2017
Where Dubai apartment rents have risen and fallen, Q2 2017
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Read more from Mario Volpi:
Homefront: Is the tenant or the owner responsible for AC bills in Abu Dhabi?
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Can a single person rent an outbuilding (essentially a studio flat) with a private entrance located within a compound of villas? Is it legitimate if the studio comes with a tenancy contract from a real estate agent and is it acceptable for the contract to include utility bills in the rental price? Would such a contract be necessary or permissible when someone has to renew a visa? SM, Abu Dhabi
I assume the person wishing to rent out this studio, is either the actual owner of the unit or, if not, the owner is aware of the proposed lease contract and has agreed to it. If yes, this is perfectly lawful especially if services are all connected directly. The difficulty lies if the utilities are shared, especially when referring to the water. Paying for these utilities is one thing but if the services are connected via a single meter in the villa, this can affect the ability of you gaining the Tawtheeq. For visa applications and renewals you will need a valid Tawtheeq contract. Getting this is possible even if there is only one water meter but only when the owner has a special approval from the municipality and the rent includes all the utilities. If you cannot get the Tawtheeq, I suggest you seek alternative accommodation otherwise you will have issues with the visa renewal.
Mario Volpi is the chief sales officer for Kensington Exclusive Properties and has worked in the property industry for over 30 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@kensington.ae
