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15 April 2024

30% rent hikes in Sharjah: Can landlord increase rent yearly?

By Parag Deulgaonkar

A 30 per cent rent hike demand from his landlord in 2016 has left KR (name withheld on request), an Indian, renting a one-bed apartment in Sharjah, shocked.

“My landlord has hiked my rent again. This is for the second consecutive year and now he is asking me to pay Dh26,000 per annum (pa) from Dh20,000 pa,” he told Emirates 24|7.

Being the sole breadwinner in the family, he admits the latest rent hike has sent his household budget haywire.
Post, paying the monthly installment on his personal loan and household expenses, KR claims he is “left with no savings”.
“I have two kids. I am paying Dh1,000 a month for my elder child’s school.

“The younger will start schooling this year and so I have to pay another Dh900 a month. It’s the rent hike demand that will make it difficult for me to meet the ends.”
Similarly, Ajmal Anwar, an Emirates 24|7 reader, informs his rent has been hiked every year.

He pays Dh42,000 pa for a one-bedroom unit in Al Nahda area in 2016, up 13.5 per cent, compared to 2015.

“Despite having municipality control on rent, landlords charge rent increase every year.

“As well if we complain, they would show the contract value, which is high.

“Besides, some also seek annual maintenance charges, satellite charges, waste disposal charges, parking charges and make it to their desired amount,” he said in a comment on Emirates 24|7 website.
In December 2015, Cluttons, a real estate consultancy, said residential rents had declined 1.6 per cent in the third quarter of 2015 - first in over two years - compared to the same period last year, but residents of some apartment blocks told this website in January 2016 that they were facing rent increases of up to 17 per cent at the time of renewal.
However, many of the residents don’t tend to file complaint with the Sharjah Municipality’s rent dispute committee even though the option exists.
Here are some of the articles under Law No. 2 of 2007, regulating the relations between landlords and tenants that protect the latter’s rights:
# Article 9 stipulates that the landlord should guarantee that the property is given on rent as per the specifications mentioned in the contract and in case any amenities found lacking, the tenant has the right to claim its addition or maintenance. It also mentions that landlords should carry out maintenance of the leased properties, unless both parties agreed otherwise.
# Article 11A states that the landlord is not entitled to increase the rent under a lease prior to the expiry of 3 years from the signing of the lease.
# Article 11B provides that the increase mentioned in Article 11A shall be according to the market rent of comparable properties and once decided will be applicable to that property for 2 consecutive years.

If the revised rental value cannot be agreed upon by the landlord and tenant, they may refer it to the Rental Committee who will settle the dispute and place a rental value on the property in question.
# Article 12 mentions the landlord will have no right to ask the tenant to vacate the property before the expiry of a period of three years from the first signing of the contract unless the tenant is refusing to pay the rent.
# Article 15A provides for the criteria which the Rental Committee will consider in determining the rental value. These include (i) the location of the property, (ii) number of floors in the property, (iii) the level of the property within the building, (iv) the finishes to the property, (v) services within the building, (vi) the age of the building according to the completion certificate and (vii) the area of the building.