Rental index completed
The Real Estate Regulatory Agency (Rera) of Dubai has completed work on the much-awaited rental index and will roll it out as soon as it is approved by the Ruler's Court, a senior official said.
"The rental index for residential and commercial units is ready and will be launched soon. The regulations for its implementation have been finalised but are awaiting approval from the Ruler's Court," said Mohammed Khalifa bin Hammad, Director of Rera's Real Estate Relation Regulatory.
The index will be published in newspapers after it is approved.
Rera has said it will not be mandatory for landlords to follow the rental index. It will, however, set a range for residential and commercial units that people can use when comparing rents in different areas of Dubai.
The index may become a reference point in the event of a dispute between landlord and tenant.
"At the time of any dispute, Dubai Municipality or any concerned authority will consult the index while taking any decision. It will be the benchmark in solving any rental disputes," Bin Hammad said.
Rera has been compiling the index over the past six months. It is now updated until the fourth quarter of 2008.
Dubai currently has a rent cap of five per cent for 2008 and the government has not yet renewed or amended this.
"[The rental index] will give the people and the authorities a base to calculate rents," said Andrew Chambers, Managing Director of real estate consultancy Asteco.
"In mature markets, we find a broad range being available and so introduction of the index is a good step towards maturity," Chambers said. "The index will also serve as a good base for valuers, which was lacking in this market," he added.
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