Rents in Sharjah soaring by 30 per cent

In Sharjah, increases simply follow market demand. Pawan Singh / The National

SHARJAH // Rents in some parts of Sharjah are soaring by 30 per cent and more as landlords take advantage of increased demand and the absence of a municipality-imposed rent cap.

One tenant, Saeed K, 37, had the rent on his apartment in Al Qassimiya increased from Dh15,000 to Dh20,000.

"There is no renovation at all but they simply want to increase the rent," he said.

In Al Nabba, letters stuffed under doors in one building told tenants their rent was increasing by 20 per cent. The letter from Al Asima Real Estate said they must pay up, or move out.

The increases are a result of market demand, an agent from Al Asima said. "The real estate market is picking up again. Even the increases we are making this month could be doubled next month because there are more people looking for flats now."

In Dubai, rent increases for existing tenants are governed by a sliding scale, depending on how far the existing rent is below a geographic rent index published by the Real Estate Regulatory Agency.

Rises are capped at between 5 and 20 per cent, depending on how far below market value the property is. In Sharjah, increases simply follow market demand.

Rental laws allow landlords to increase rents in relation to the popularity of the area, after a tenant has been renting for three years.

"We keep an idea what rents in areas are like and expect landlords in areas like Al Nabba not to charge or increase rent to those in Al Khan," said Saleem Al Kaabi, director of the rental disputes section at Sharjah Municipality.

"Once a tenant suspects they are being overcharged by the landlord they can always lodge a complaint with us and we will investigate and reconcile the two parties."

While Sharjah is still a relatively cheap place to live compared with other emirates, tenants have recently been asked to pay increases in annual rent of Dh3,000 to Dh4,000.

In traditionally low-cost areas such as Rolla and Butina, the rent on a one-bedroom flat has gone from Dh17,000 to Dh20,000, and a two-bedroom from Dh22,000 to Dh25,000.

In medium-cost areas such as Abu Shagara, Al Nahda and Al Khan, a one-bedroom flat now costs Dh22,000, up from Dh18,000, and a two-bedroom is now about Dh28,000, up from Dh24,000.

One tenant in Al Nabba complained that his property company was putting up the rent for no good reason.

"For the past three years I was giving them a commission of Dh1,000. They are not reducing my rent but increasing it from Dh17,000 to Dh20,500 and for what?

"They tell us there is an economic recovery and are increasing our rent, but not salaries – that is selfish."

Another resident blamed the rent increases on speculators looking to copy increases in Dubai.

"It's getting more expensive to stay in Sharjah and work in Dubai," said one Al Nabba resident. "You have to pay rent almost the same as that in Dubai and then a higher utility bill and Salik gates to go to work on Sheikh Zayed Road each day."

Mr Al Kaabi said tenants should lodge any complaints with the committee at least 15 days before the end of their contract and pay a Dh500 fee.

He said more than half the complaints the municipality received last year came from landlords against tenants who defaulted on paying rent.