Here are the latest updates on Dubai rent rules…
Dubai rents are climbing across the board, but with the new property index in place, landlords are now required to give a 90-day heads-up before raising the annual rent on their properties.
The breakdown…
New rules have been put in place to regulate rent hikes, ensuring tenants are protected from sudden or unfair increases. Landlords must give tenants a 90-day notice before the lease ends if they plan to raise the rent. The increase will only happen if the Smart Rent Index confirms the property qualifies.
If the landlord fails to give the tenant a 90-day notice before the lease ends, no rent increase will be allowed, even if the index would have approved it.
In situations where the landlord has given the proper 90-day notice and the previous index allowed the increase, but the new index doesn’t, the index that applies will be based on the renewal date.
This means that the terms of the previous index will apply if the contract was renewed before 2025, while the rules of the new index will kick in if the contract is renewed in 2025 or later.
But why is this necessary?
With Dubai’s population steadily growing and demand for rentals and property purchases continuing to rise, stability in the property market is essential. This ensures protection for both tenants and landlords while boosting consumer confidence in the market.
In the third quarter of 2024, rents rose for the 15th consecutive quarter, jumping by 18% year-on-year. Apartment rents went up by 19%, while villa rents saw a 13% increase, according to the research.
To curb the sharp rent hikes in the final quarter of 2024 and help control overall inflation in Dubai for 2025, the new index aims to create a more stable and transparent rental market. This way, renters and landlords can make informed decisions backed by reliable data.
The new property index…
The new property index, launched by the Dubai Land Department on January 2 this year, is designed to bring stability to the property market. The Smart Rental Index uses artificial intelligence to offer real-time property price updates, unlike the previous index, which was only updated once a year.
Other features of the new index include a star rating system for residential buildings and a more detailed focus on individual buildings, rather than just zones or districts like the old index. Additionally, the new index will cover all areas in Dubai, including both freehold and non-freehold zones.
