Your Dubai rent index update once a year: DLD
The official Dubai rent index is no longer being updated every four months, as done since 2009 when it was launched, Dubai Land Department (DLD) confirmed to Emirates 24|7.
“The rental index now is being updated once per year, starting from 2015,” the DLD said in an emailed statement sent to this website.
The index, updated thrice a year, was intended to reflect at least the current market rentals and termed as “a step that would create transparency, trust and confidence between the tenants and landlords.”
“After reviewing and studying the feasibility of issuing three indicators each year, and how it affects the submission of the increase in rates and the amount of impact coming from the data recorded in updating the index, we have adopted the issuance of one indicator per year starting 2015,” the DLD said, adding, “so it does not show any change in the data of the index that was released on January 1, 2015.”
This website had reported that Real Estate Regulatory Agency (Rera), the regulatory arm of DLD, is planning to unveil a more detailed rent index this year which will take into consideration various factors such as views from the apartment and facilities in a tower, age of the building, etc, when revealing the average rent for the apartment.
Previously, the rent index would only show rent for a four-month period. However, it now shows rentals till the end of the year.
“It was announced earlier that there will be additions and new properties on the index, this is all currently in the stage of studying of the new properties, characteristics and specifications, and what affects the rents on all levels, both technical, locations or services, and then we will place the properties and the mechanism of the application after the completion of the study,” the DLD said.
In order to control arbitrary rental hikes, the Dubai government has already issued Decree No. 43 of 2013 concerning the percentages of maximum property rent increase that are to be allowed upon renewal of tenancy contracts. The rent increase slabs are as follows:
# No rent increase if the rent of the property unit is less than 10 per cent of the average rent of a similar property in the same residential area.
# If the rent value is between 11 and 20 per cent less than the average rent of a similar property, the maximum rent increase shall be equal to 5 per cent of the rent value.
# If the rental value of a unit is between 21 and 30 per cent less than the average rent of a similar unit, the maximum rent increase shall be equal to 10 per cent of the rental value.
# If the rental value of a property is between 31 and 40 per cent less than the average rental of a similar property, the maximum rent increase shall be equal to 15 per cent of the rental value.
# If the rental value of a property unit is less than 40 per cent or more of the average rent of a similar unit, the maximum rent increase applicable is of 20 per cent.
The decree also informs that the average similar rental value of the property will be determined by the rent index.
Follow Emirates 24|7 on Google News.