Rera Confirms Higher Rents For Some

After weeks of conflicting reports, the Real Estate Regulatory Agency (Rera) on Wednesday finally sought to clear the confusion over the future of the rent cap and introduction of a rental index. In a four-page statement, Mohammed Khalifa bin Hammad, director of the Relationships Department in Rera, explained how the rental index will work. Mohammed Khalifa said that rental contracts renewed in 2008, which are more than 25 per cent below the maximum rents limit, would be subject to increases. It was not clear whether that those who were already mid-way through paying for their annual tenancy, will suddenly be asked to pay more for the latter part of the year. The rental index follows a decree on Monday stating that rents would be frozen if they were within averages set out in the newly published index. However, landlords may raise rents, in a limited manner, if they fell below the averages. The new decree has been issued to balance the rental market and make the landlords, who have rented their properties against very low rents, entitled to a proportional increase in rents at different averages, he said. He said that any landlord, who wished to seek an increase, would first have to approach the Tenancy Disputes Committee concerned and have the level of increase correctly calculated. The Rera statement did not clarify whether the Dubai Municipality’s Rent Committee will be the competent body to approach. Mohammed Al Shaikh, general secretary of the committee, was unable to comment substantively, but said that the body will continue to manage disputes.