UAE Property: ‘The 90-day notification period has ended to renew my lease’

Question: I rent a villa in Dubai and the property manager is a real estate company.
Six months before the end of the current lease, the property manager notified me by email saying that future lease renewals would be based on the Real Estate Regulatory Agency rent calculator.
The property manager said they would contact me 90 days before the contract’s expiry date to confirm if I wanted to renew the lease.
They did not specify how much the rent would be increased but said that I could check it for myself. At the time, the increase was 15 per cent, according to Rera.
However, the 90-day window has closed as the lease will be expiring in two months’ time and they have yet to notify me of the new rent.
I contacted the property manager and told them I want to renew but need to know the new rent.
While I expect them to confirm the rent amount very soon, I believe it will be too late and they have missed the 90-day notification window.
I am also worried that the Rera calculator may now assess the rent higher than the original 15 per cent calculation.
Do you suggest that I raise a dispute or am I likely to lose the case? DV, Dubai
Answer: It is perfectly normal for landlords to inform tenants that there will be changes to the rental amount earlier than the 90-day window.
The Rera calculator’s increase of 15 per cent serves as a guide for what the increase could be at the time of renewal.
I would not worry too much about the landlord’s lack of communication at this stage, because all you need to do is visit the Rera rental calculator again to see if the increase has changed from the 15 per cent calculation.
The landlord has said that the Rera rental calculator would be the barometer for any change in rent and if it does rise, for example, to 20 per cent, this amount would be legal.
You already know that the increase is at least 15 per cent or, at worst, it could go as high as 20 per cent, so prepare yourself for this eventuality.
If you do not agree with the rent increase, you would have no alternative but to look for another property to rent and move out.
Q: I am staying in one-bedroom apartment and paying a yearly rent of Dh32,000 ($8,713). My contract will be renewed in January 2024 and – until recently – there had been no notification from the estate agent that the rent would be increased.
However, when I visited the estate agent, he said that the rent would be increased to Dh38,000.
I was told by the agent on behalf of the landlord that if I do not wish to renew the lease, I must pay a penalty of 60 days as I have not informed them that I do not want to continue with the contract.
Can you tell me what my legal rights are regarding this? Also note that my contract states that I must pay Dh1,000 to renew the contract, which I am willing to pay. AI, Dubai
A: There are a few points to consider here. Firstly, any changes to a contract can only happen when at least 90 days’ notice has been given and all parties must agree to them.
When the lease changes apply to the rent, any increase can only be allowed if the Rera calculator allows it, so you would need to check that this is the case.
You should also note that under property law 33 of 2008, you are not required to give notice that you will not renewing the lease.
The most expensive villa sold in Dubai The most expensive villa yet sold in Dubai cost Dh302m ($82.2m). All photos Alpago Properties
This is because your rental contract has a start and an end date, so despite the 60-day notification clause in the renewal contract, you can dispute this by filing a case with the Rent Dispute Settlement Committee in Deira, Dubai.
Ultimately, if you do decide to renew and are OK with an increase in rent, then you would have to pay the renewal fee of Dh1,000.
Mario Volpi is the sales director at AX Capital. He has worked in the property sector for 39 years in London and Dubai. The opinions expressed do not constitute legal advice and are provided for information only. Please send any questions to [email protected]