Tenants breathe a sigh of relief as a no increase in 2008 decree is announced.
Rents for Dubai tenants whose contracts were signed in 2008 cannot be raised this year so long as the rent in 2008 is equal to or up to 25 per cent lower than the average market rate, according to a decree issued yesterday.
According to decree No 1 for 2009 issued by His Highness Shaikh Mohammed Bin Rashid Al Maktoum, Vice-President and Prime Minister of the UAE and Ruler of Dubai, rents for both residential and non-residential properties in Dubai whose contracts were signed in 2008 cannot be increased in 2009 so long as the rent in 2008 is equal to or up to 25 per cent lower than the average market rate.
The new decree includes a mechanism to deal with low rents, where rents for the current year can be raised as long as the rent for 2008 was up to 25 per cent less than the average market rate.
Mohammed Ebrahim Al Shaibani, Director of the Dubai Ruler's Court, said Shaikh Mohammed's decree aims to curb the soaring rents in Dubai and bring them to reasonable levels.
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siju mathew Jan 20, 2009 05:45 am
Hi, this is certainly good for the market as it will prevent unpleasent burden on the tenants. However, i have some concerns;
1. what about a new contract this year, will the rent be fixed as per the average shown in the rental index
2. now the definition of an area and the sample considered for the index will be put on test as in this case average rental in a particular area is the benchmark.
3. what about outliers in a particular area, say in Karama you have housing colony apartments and also apartments in Burjman Centre
4. if the rental is less than 25% of the average how much can the land lord increase the rental, is it till the value reaches 25% of the rental or is it till the average?
i hope to find clairifications to this in the decree pdf