Dubai Rental Increments Capped by 7%

H.H. Sheikh Mohammed bin Rashid Al Maktoum, Vice President, Prime Minister and Ruler of Dubai, in his capacity as Ruler of Dubai, has issued a decree on rent allowance in the Emirate of Dubai.

The new rent allowance was decided after taking into consideration Decree no. 2 of 1993 and its amendments, which set up a special committee to look into and settle disputes between landlords and tenants, and Decree no. 14 of 2005 which set a ceiling for any rent increase in the emirate.

According to the new decree, the rent allowance shall not exceed 7% of the annual rent charge of the property. This shall apply to all rent contracts that are to be renewed in 2007 on condition that no rent increment was made on that property in 2006.

No rent allowance shall also be increased in 2007 on properties whose contract had already been signed in 2006 with a new tenant, Article 2 of the new decree said. The decree tasked the special judiciary committee in charge of settling disputes between landlords and tenants to come up with the appropriate measures for the implementation of the new decree, which takes effect from the date of its issuance, January 1, 2007 and is to be published in the official gazette. (Emirates News Agency, WAM)