Year in review 2014: Most common property problems in the UAE

The National’s real estate expert, Mario Volpi, reviews the year’s most common property problems in the UAE.
The Dubai property market is potentially taking a breather as we head towards the end of 2014, writes Mario Volpi. Pawan Singh / The National
The Dubai property market is potentially taking a breather as we head towards the end of 2014, writes Mario Volpi. Pawan Singh / The National

This year it became clear to me that there is still much confusion between the rights of landlords and tenants, so to be able to clarify to the public the correct path to follow as per the law and then to receive follow-up feedback makes the job worthwhile.

Over the last 12 months, I have had a wide range of queries but the majority of letters I receive centre around a few subjects. The first is eviction notices from landlords and what is allowed and how to legally get tenants to vacate the properties, together with clarification on how to legally serve the 12 months’ notice to tenants.

The other major topic for dispute is the amount of rent a landlord can legally charge in any one given year. This includes confusion over the 90-day notice period, which a lot of landlords forget about or, indeed, miss the window altogether.

This leads to an incredible amount of frustration that landlords suffer when they learn that despite what the Rera rental calculator may say is the permitted amount of increased rent, they cannot raise any rent if the notice is not served correctly.

The first half of this year saw a continuation of sales and rental increases across the board and with this came letters, especially from tenants requesting information on their legal rights.

It never ceases to amaze me the lengths some landlords go to to try to flout the law in their attempts to get vacant possession of their property. This often involves intimidation of the tenant. I must stress that not all landlords are doing this, and there are obviously many that seek my help and advice for legitimate reasons in requesting return of possession.

To balance the argument, not all tenants are “angels”. There have been times when I have advised landlords when tenants have also not followed the correct procedures as per the law.

The second half of the year has brought a cooling of the property market, especially from the end-user sales sector. Rentals have also come off the boil, but not in all areas.

With this cooling of the market and a slow summer, coupled with the effects of Ramadan and the Eid holidays, it brought an array of letters requesting information. Where they should invest, which areas and types of properties would be the easiest to rent out, or what would attract the best possible capital appreciation?

As we head towards the end of this year, the Dubai property market is potentially taking a breather. Some say it is maturing and, in doing so, there is a stalemate between buyers and sellers and landlords and tenants.

Everyone’s expectations are now polarised, as sellers believe the market is better than it is and buyers believe the market is worst than it is. The same can be said about rental.

This difference of opinion is actually causing the market to do very little and the consequence of this can be far reaching, as real estate companies with high advertising and other overheads will struggle to stay afloat.

There could be difficult times ahead as only the best will survive. In some respect this could be positive as there are presently over 2,200 real estate companies and over 5,500 individual brokers chasing an ever decreasing size of the real estate pie.

I would like to thank the readers for their questions and input with the hope that I can be of further assistance to all as we welcome in 2015.

Some highlights from Mario Volpi’s Homefront column in 2014:

January: The only situations in which a Dubai landlord can evict you

I live in the Springs and my landlord informed me in November that she wants to evict me from the house in March 2014 (when my current contract expires). She has also served me a letter from Dubai court with the same. Before that I was in the process of registering for Ejari, but she refused to give me the title deed until I signed a paper backdated to February 2013 saying that I was informed that she does not want to renew the contract, I refused to sign this paper until she put the correct date on it. Does she have the right to do that? What is the procedure if I want to fight this and stay in the house. RR, Dubai.

It never ceases to amaze me how inventive landlords are becoming in their quest to evict their tenants just so that they can get a higher rent when they go back into the “open market”. The law however is very clear in what is permissible by a landlord and what is not. The landlord can only request you move out under certain circumstances:

1. If the property requires extensive modernisation that would mean one couldn’t possibly remain in the property during these renovations.

2. If the property requires demolition. In both of these cases, the landlord would also have sought documentation supporting this from Dubai Municipality.

3. If the landlord or her next of kin of first degree wanted to move in. In this case she would also have to prove she did not also own a similar alternative property.

4. If the landlord wishes to sell.

In both of these last two cases she would have to give you your statutory 12 months’ notice period in the form of a notarised document that was delivered to you via registered post (couriered).

April: No-win situation for Abu Dhai tenant given 105 per cent rent hike

I have lived in an Abu Dhabi building since 2007. Every year we have had a rental increase of 5 per cent at the renewal of the lease agreement. Currently the rent is Dh25,806. The lease agreement is expiring on August 23. Now I have received a notification informing me that the new rent will be Dh53,000 – which is a 105 per cent hike. I understand that this increase is due to the 5 per cent yearly increase cap being taken away but I would like to know, as per the law in the UAE, if there is any limit on the increase a landlord can demand. TT, Abu Dhabi

Before the abolition of the rental cap, the emirate of Abu Dhabi had strict laws limiting the amount a landlord could raise the rent annually and this was a maximum of 5 per cent of the annual rent. Your landlord is entitled to raise the rent for this year as he sees fit. But there is no limit of increase imposed on landlords anymore. The Government has allowed this to help landlords achieve market rent, especially for those investors who historically were receiving very low rents.

It appears that your landlord does not care whether you will stay or decide to vacate the property because of the outrageous increase. This being the case, I suppose that the landlord is maximising his position and if he gets away with it, he will be happy as he will be getting a substantial amount more for his rent. If you do leave, I guess that another tenant may be found quickly. Either way you will end up being on the losing side.

June: Landlords giving UAE tenants short notice to remove pets, or move

We run a website called Adopt-Me.ae and at the moment we are being inundated with pet owners who are suddenly re-homing their pets – or worse, abandoning them – because their building management committees or landlords now say that pets are no longer allowed. We were wondering if the tenant’s contract states that pets are allowed, but then the landlord or management committee decide/vote to change this, whether the tenant has any rights at all. For example, we’ve had a few families who were only given a few days’ notice before they were told to either move or get rid of their beloved pet. Can a landlord actually tell a tenant to leave because he or she owns a pet if it states in the rental contract that pets are allowed? Any advice to help protect pet owners against this would be greatly appreciated. Peta Wittig, Adopt-ME.ae Founder

The law states that any changes to a tenancy contract have to be communicated by both parties (landlord and tenant), giving at least 90 days’ notice before the expiration of the tenancy agreement. Before accepting any potential tenant with pets, I would suggest that the landlord be responsible enough to check with the building management (if an apartment) if pets are indeed allowed. I too have heard that some building owners have given only a matter of days to request eviction of the pet with no consideration to the family at all. I am sure you are perfectly aware of the difficulties pet owners have living in the UAE, but it does not have to be like this.

October: Abu Dhabi tenant told landlord’s permission needed to sell own sofa

I have had a fairly conflict-free tenancy in my Abu Dhabi apartment for the last two years. However, last weekend I tried to sell my sofa after upgrading to a new one, and security prevented me from removing the old sofa from my apartment stating that I must have a No Objection Certificate (NOC) from my company (with whom the lease is). Even with the new sofa right there, they still hid behind the ‘you might be trying to illegally vacate’ line. Is there any legal basis for requiring me to obtain an NOC from my company to upgrade my furniture? To your knowledge, does my landlord have the legal right to physically stop me from removing a sofa from my apartment? MS, Abu Dhabi

After reading your comments, it does appear ridiculous that you are prevented from leading a normal life as you please. The rules regarding the NOC from the landlord are there to prevent tenants from absconding without paying their outstanding liabilities. You have two choices, one legitimate and one not so. Go and get this NOC from the landlord (I am sure this would not be too difficult given the circumstances), or move the sofa into the lobby of the apartment, then wait. I am sure you will get complaints from the security guards/management that the sofa cannot stay there, after which you can strongly suggest they then allow you to remove it altogether from your apartment. Thus resolving both issues.

Mario Volpi is the managing director of Ocean View real estate and has worked in the industry in the emirate and in London for 30 years. Send any questions to mario@oceanviewdubai.com

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Published: December 22, 2014 04:00 AM

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