A growing number of landlords in Dubai have started giving 12-month notice to tenants, served at the time of signing of the tenancy contract, stating the apartment needs to be vacated after the lease expires as he plans to sell the unit.
“Landlords are giving 12-month notices to tenants at the time of signing a new lease contract. The notice states that the former will be selling their apartment as soon as the lease is over,” real estate agents told Emirates24|7.
Agents say these notices fall under the regulations laid down in Article 25 of Law 26 of 2007 (as amended by Law 33 of 2008) regulating relationship between landlords and tenants in the emirate of Dubai.
“These notices are legal. Therefore, it is helping the landlord evict a tenant after 12 months. He will, therefore, be able to lease once again at the current market rate.”
New clauses, included in the tenancy contract addendum, say, “Tenant is, hereby, being served a notice of 12 months by the landlord to vacate the property. By signing on this rental contract, tenant hereby duly acknowledges of being served this notice to vacate at the end of the tenancy period in this agreement, 12 months in advance as per Law no 33 of 2008 and agrees to vacate accordingly.”
Arshad Parekh, an expatriate, says: “We signed a contract for a two-bed apartment in Marina and the contract does state we vacate the house following the expiry of the lease as the owner wants to sell the unit thereafter.”
“I am sure he isn’t going to sell the unit… he will be renting it at the higher rent with the agent also getting his commission. I think I don’t stand a chance to contest the claim in rent committee since I have willingly signed the contract,” he adds.
According to Reidin rent index, rents in Dubai rose by 17 per cent year-on-year with secondary locations continuing to recover and outperforming some of the primary locations during the fourth quarter of 2013. Rental values increased the most on a yearly basis in areas such as Sports City, International City, Silicon Oasis and Jumeirah Lakes Towers compared to Dubai Marina or the Palm Jumeirah. Jones Lang LaSalle, however, expects rents to rise at a slower pace in 2014 compared to last year.
So when can a landlord ask a tenant to vacate his property?
Article 25 of Law 26 of 2007 (as amended by Law 33 of 2008) provides for the circumstances in which a landlord can ask a tenant to vacate his property.
1. A landlord may demand eviction of tenant prior to expiry of tenancy period in the following cases:
a. If the tenant fails to pay rent value, or part thereof, within thirty (30) days of the landlord’s notification for payment; unless parties agreed otherwise.
b. If the tenant subleases the property, or part thereof, without the landlord’s written approval and in such case eviction shall be applicable to the tenant and the subtenant, and the subtenant’s right to refer to the tenant for compensation shall be reserved.
c. If the tenant uses, or allows others to use, the property for illegal or immoral activities.
d. If the leased property is a commercial shop and the tenant left the same without occupation and without legal reason for 30 continual days or 90 non-continual days in one year; unless the parties agreed otherwise.
e. If the tenant causes changes that endanger safety of the property in a way that it cannot be restored to its original condition or if he causes damage to the property intentionally or due to his gross negligence to take proper precautions or if he allows others to cause such damage.
f. If the tenant uses the property for purposes other than the purpose it was leased for or if he uses the property in a way that violates planning, building and land using regulations.
g. If the property is in danger of collapse, provided that the landlord must prove such condition by a technical report issued by Dubai Municipality or accredited by it.
h. If the tenant fails to observe legal obligations or tenancy contract conditions within (30) days from date of notification by the landlord to abide by such obligations or conditions.
1. If development requirements in the Emirate require demolition and reconstruction of the property in accordance with government authorities instructions.
And for the purpose of this clause (1) of this Article the landlord must notify the tenant through the Notary Public or by registered mail.
2. A landlord may demand eviction of tenant upon expiry of tenancy contract limited to the following cases:
a. If the owner wishes to demolish the property for reconstruction or to add new constructions that prevent tenant from benefitting from the leased property, provided that necessary licences are obtained.
b. If the property requires renovation or comprehensive maintenance which cannot be executed while tenant is occupying the property, provided that a technical report issued by Dubai Municipality or accredited by it is to be submitted to this effect.
c. If the owner of the property wishes to recover the property for use by him personally or by his next of kin of first degree provided that he proves that he does not own a suitable alternative property for that purpose.
d. If the owner of the property wishes to sell the leased property.
And for the purpose of this clause 2, the landlord must notify the tenant with reasons for eviction at least twelve months prior to the determined date of eviction subject that such notice be sent through the Notary Public or by registered mail.