‘The 90-day notification period to renew my tenancy contract has ended’

Q I rent a villa in Dubai, which is managed by a real estate company. Six months before the end of the current lease, the property manager notified me by email saying that future lease renewals would be based on the Real Estate Regulatory Agency rent calculator.

The property manager promised to contact me 90 days before the contract’s expiry date to confirm if I wanted to renew the lease.

They did not specify how much the rent would be increased but said that I could check it for myself. At the time, the increase was 15 per cent, according to Rera.

The 90-day period has now passed and the lease will be expiring in two months’ time. The company has yet to notify me of the new rent.

I contacted the property manager and told them I want to renew but need to know the new rent. I am also worried that the Rera calculator may now assess the rent higher than the original 15 per cent calculation.

Do you suggest that I raise a dispute or am I likely to lose the case? DV, Dubai

A It is perfectly normal for landlords to inform tenants that there will be changes to the rental amount earlier than the 90-day window.

The Rera calculator’s increase of 15 per cent serves as a guide for what the increase could be at the time of renewal.

I would not worry too much about the landlord’s lack of communication at this stage. Visit the Rera rental calculator again to see if the increase has changed.

The property manager has said that the Rera rental calculator would be the barometer for any change in rent and if it does rise, for example, to 20 per cent, this amount would be legal. You already know that the increase is at least 15 per cent or, at worst, it could go as high as 20 per cent, so prepare yourself for this eventuality.

If you do not agree with the rent increase, you would have no alternative but to look for another property to rent and move out.

I am staying in a one-bedroom apartment, with a yearly rent of Dh32,000 ($8,713). My contract will expire next month and – until recently – there had been no notification from the property agent that the rent would be increased.

However, when I visited the agent, he said that the rent would be increased to Dh38,000. I was also informed that if I did not renew the lease, I must pay a penalty of 60 days as I have not informed them that I do not want to continue with the contract.

Can you tell me what my legal rights are regarding this? My contract also states that I must pay Dh1,000 to renew the contract, which I am willing to pay. AI, Dubai

There are a few points to consider here. Firstly, any changes to a contract can only happen when at least 90 days’ notice has been given and all parties must agree to them.

Any change to rental amount can be made only if the Rera calculator allows it, so you would need to check that this is the case.

You should also note that under property law 33 of 2008, you are not required to give notice that you will not be renewing the lease.

This is because your rental contract has a start and an end date, so despite the 60-day notification clause in the renewal contract, you can dispute this by filing a case with the Rent Dispute Settlement Committee in Deira, Dubai.

If you do decide to renew and are OK with an increase in rent, then you would have to pay the renewal fee of Dh1,000.

Mario Volpi is the sales director at AX Capital. He has worked in the property sector for 39 years in London and Dubai. The opinions expressed do not constitute legal advice and are provided for information only. Please send any questions to m.volpi@axcapital.ae