Tenants angry over Dubai housing fee overcharge

Municipality says tenants who are overcharged should have registered their details sooner.

Aijaz says he has been overcharged the housing fee for his flat in Dubai's Nahda area.

DUBAI // Residents of the emirate are highlighting what they claim are widespread inconsistencies in Dubai Municipality's housing fee.

Many say the municipality is overcharging them on the monthly fee, taking too long to process requests for corrected rates, and refusing to refund the excess charges they have paid. Others admit they are paying nothing at all.

The emirate-wide fee, which helps fund public services such as food inspection and waste disposal, is supposed to be set at 5 per cent of a tenant's annual rent. For convenience, it is charged on the monthly utility bills distributed by Dewa, the Dubai Water and Electricity Authority.

Senior municipality officials acknowledged receiving a high number of complaints about the fee, but said that residents were at fault - and not eligible for refunds - because they had not registered their rental details on the municipality's website, despite public notices.

For unregistered tenants, they said, they relied on neighbourhood rental estimates set by the Real Estate Regulatory Authority (Rera), whose accuracy, they said, was not their responsibility.

"It's ridiculous. Whatever amount should be paid, you should update it, and refund it," said Aijaz, a 45-year-old Pakistani facing high fees and no refunds for the one-bedroom flat in Al Qusais that he began leasing in April.

When he visited the small municipality bureau at the Dewa headquarters, where housing fee complaints are received, he said he was told his flat had been charged as a two-bedroom because most of the flats in his area had two bedrooms.

Aijaz, who declined to give his last name, was told to register his correct rent on the municipality website by clicking on a small green house-shaped icon at the bottom right of the page, and that it would take effect within two months. He said he was told he would not be refunded excess payments charged during that time. The icon was not visible on the homepage when The National visited the site on Thursday and again yesterday.

Although many residents such as Aijaz do not know about the registration process, Saif Rashid Al Shamsi, the director of the finance department, stressed that the municipality issued notices through various media and on bills.

"We made announcements to all tenants in Dubai to fill in the necessary information through the proper system on our website," he said.

Yet Sigrid Malong, despite registering her Dh40,000 rent online last year, ended up being charged at a fee based on a rent of Dh50,000.

She took a leave day from work recently to try to reclaim Dh300 in excess charges. The effort cost her several hours and more than Dh50 in taxi fares to commute between Dewa and municipality offices several times.

"This is my primary thing today," she said. Though the sum was not huge, she said, "it's still money I could use elsewhere."

The municipality said the period to adjust the rent estimates might shorten from its two-month maximum once the municipality obtains access to Dewa's billing system so they can update fees themselves, officials said.

"We expect minimal complaints and cases will be solved quicker after that," said Mr Al Shamsi.

The chief executive of Dewa, Saeed Al Tayer, said municipality officials input the housing fees into Dewa's system. He referred questions to them but said he would raise the issue with his billing department.

Abdullah Hashim, the head of housing fees at the municipality, said unregistered tenants should not expect refunds for being overcharged as a result of the official rental estimates.

"Go to the website and register the correct details and within a maximum of two months the fees will override the old ones - but without getting any credit back or without it being backdated because this is the mistake of those who did not register," he said.

Mr Al Shamsi pointed out that customers who pay a low housing fee based on Rera estimates tended not to register - it was only when estimates exceeded rents that tenants complained.

Pedro, a 61-year-old Indian who has lived in the same flat in Karama for 30 years, visited Dewa after his housing fee tripled last year. The inflated rate had begun appearing on his Dewa bill. Before that it had been collected by his developer. He requested a correction in February. The fee dropped in April. In June he began what has become a weeks-long process to reclaim the Dh312 he overpaid.

He sent three e-complaints, but after some confusion was sent back to Dewa - where he sat on Wednesday for more than two hours waiting for 40 people ahead of him to be called. "Thank God I'm retired," he said. Unlike Aijaz, Pedro was told by a supervisor passing by that he could get a refund after a month. He asked for a guarantee but settled for the official's word.

"I hope," he said. "I want to fight for my principle. I want my money back."

When did the housing fee take effect?

It has been levied since 1962. Before being collected through Dewa, it was paid through the Department of Economic Development and the Real Estate Department (now called Wasl).

Why do some people pay the fee while others do not?

The only residents exempt from housing fees are Emirati citizens and those with lease contracts in the name of consulates, federal ministries and the armed forces.  Fee collection was transferred to Dewa in phases from 2005 to 2010, but may have unintentionally left some people out.

How is the fee charged?

It is set at five per cent of annual rent – either the exact amount provided by tenants or the estimated rate set by the Real Estate Regulatory Authority.

How does the housing fee differ from the service fee?

Service fees are charged by property developers for the upkeep of their residential areas. Housing fees help fund emirate-wide services including air quality control, food inspections and waste disposal.

How can residents submit their accurate rental price?

They must register their details at www.dm.gov.ae by clicking on a green icon shaped like a house. The correct information should appear on the Dewa bills within two months.