Terms of tenancy agreements get tougher

Some real estate brokers in Dubai are incorporating clauses such as finding replacement tenants, or forego rent for the remaining period if a person loses his job, prospective tenants told Emirates Business.

"Brokers are asking us to find a replacement in case we happen to lose our job. And if we fail to find one, then we have to forfeit the entire rent," said SP, who has been searching for an apartment in Bur Dubai and Karama area.

Generally, tenants have to give two to three months' notice, as per their contract, if they want to terminate their lease. However, brokers now say post-dated cheques will not be returned unless a replacement is found.

In January, Sharjah amended its tenancy law, allowing tenants to exit their contracts for reasons beyond their control by paying 30 per cent of the amount due for the remainder of the contract. According to a prospective tenant, some brokers were also asking them to bring a company letter to verify their employment status. "I have been asked by some brokers to furnish a letter from my company, saying 'I am employed with them'," SP added.

Although rent-free periods are being offered to lure tenants, most brokers refuse to incorporate lease break clauses in their residential rental contracts.

"No one is willing to alter or change their contract terms and incorporate break clauses. We have no option but to sign contracts that have been prepared by them [brokers]," another prospective tenant said.

Besides, brokers have shirked their responsibility of getting residential rental contracts registered with the ejari, the e-registration portal of Real Estate Regulatory Agency (Rera).

"They said we [brokers] will not register the contracts with Rera and if it was required then tenants have to get it done themselves," the prospective tenant added.

In April, Mohammad Khalifa Ahmed bin Hammad, Director of the Real Estate Relationship Regulating Department, Rera, told this newspaper that registration of residential and commercial rental contracts was mandatory through the ejari system.