His Highness Sheikh Saqr bin Mohammed Al Qasimi, Supreme Council Member and Ruler of Ras Al Khaimah has issued a new tenancy law enforcing the rights of landlords and tenants in rental contracts and freezing rent hikes at five per cent a year for residential properties.
The law stipulates the duration of a rent contract shall be agreed upon in the contract. And in case the two parties fail to agree on a rental period, the duration of the contract shall be three years for residences, and two years if the rented property is meant for commercial, industrial or professional activity.
Law number eight was issued by Al Qasimi. Under the new law, both parties to the contract shall have the right to renew the contract for the same duration as agreed on in the previous contract – or for any other duration should the two parties fail to agree – and the contract shall be considered as renewed for the same conditions.
Meanwhile, if either party desires not to renew the contract, they should inform the other party in writing three months before the expiry of the contract if the property was used for residence, and two months if it was used for commercial, industrial or professional purposes. The letter should be sent by registered mail so that the other party is assured to receive it.
To protect the right of tenants, the law also covers living conditions. The law stipulates the landlord shall hand over the rented property to the tenant in a proper condition – in accordance with what was agreed on in the contract. And if the rented property appears to be in an improper condition, the tenant has the right to ask the court to annul the contract or reduce the rent.
In return, the tenant is obliged to use the rented property for the purpose it was designed for and in accordance with what was agreed upon in the contract.
In addition, a tenant is not allowed to make changes in the rented property without a written permit from the owner unless the change does not lead to any damage. Should the tenant made changes that cause damage, the landlord has the right to oblige the tenant to restore the situation to its original condition or to compensate the landlord if needed.
Tenants shall also pay water, electricity and telephone bills as well as for any damage done to the rented property or any other fees.
Rent caps are also part of the new legislation. The law stipulates the landlord is not allowed to raise the amount of rent agreed upon except in two cases: the lapse of at least three years from the date of signing the contract if the property was meant for residence, and at a rate of no more than five per cent a year, and the lapse of at least two years from the date of signing the contract if the property was meant for commercial, industrial or professional purposes and at a rate of no more than seven per cent a year.