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Dubai rent inflation restricted

Tuesday, November 15, 2005

General Shaikh Mohammad Bin Rashid Al Maktoum, Dubai Crown Prince, UAE Defence Minister and Chairman of the Dubai Executive Council, ordered yesterday that rent increases in all leased properties in Dubai must not exceed 15 per cent annually.

The order came into effect yesterday and will remain in force until the end of 2006. The order says that if property leasers or landlords decide to increase the rent for any property, it cannot exceed 15 per cent of the annual amount.

Shaikh Mohammad instructed authorities to implement the order, which came in line with his keenness to preserve social stability and reduce pressure on all sections of society. The decision also aims to reduce the burden on tenants.

Dubai residents welcomed the order and urged its strict implementation. Real estate agents told Gulf News that the decision will prevent tenants from "being exploited". They said the 15 per cent increase limit was "a fair thing" to impose on landlords.

he Rent Committee at Dubai Municipality will be the authorised body to to design a mechanism for swift implementation of the order, according to WAM.

A property market survey found that rents for one-, two- and three-bedroom apartments in Dubai rose by an average of 38 per cent over the last 12 months.

Rents for office space have also soared by an average of 29 per cent since October 2004.

Qasim Sultan, Director General of Dubai Municipality, told Gulf News that Shaikh Mohammad's order was timely.

"The maximum limit of 15 per cent rent increase will serve both landlords and tenants, and both have welcomed the decision. This step will help curb the 'rent race' being followed by some property owners to make money," he said.

Sultan said the decision is based on a study of the rent market in the emirate and it reflects Shaikh Mohammad's vision, which takes into consideration the interests of all parties.

Sultan said the Rent Committee would be an independent body to devise a proper mechanism to implement the order from the date of issuance.

Saeed Mohammad Al Kindi, chairman of the committee, said the decision would reflect positively on the property sector.

He said the committee would receive complaints regarding rent increases. "We respect the interests of both tenants and landlords and try to resolve rent disputes amicably," he said.

1:30 AM :: ::
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