We would like to give notice to our tenants to move out as our apartment is currently let at about 50 per cent below market. They are halfway through their lease and we understand we have to give notice in a very specific way, otherwise it may not be valid legally. It’s a Dubai property on the Palm and we figure we may sell it this year and, if we do, it’s better to have it producing closer to a market rent. How do we go about doing this and what is the correct protocol? SB, Dubai
You will not be allowed to request eviction from your tenant to get a better market rent as this is not allowed by law. Decree 43 0f 2013 was put in place by Sheikh Mohammed bin Rashid, Vice President of the UAE and Ruler of Dubai, to allow you to raise the rent by incremental amounts as determined by the Rera rent calculator. As the landlord, you will not be allowed to raise the rent by any more than 20 per cent in any one given year. Be aware that any changes to the contract, and this obviously would mean the rental amount, must be notified to the other party giving 90 days’ notice before the expiration of the tenancy. The law states that if you do not inform the other party of any changes to the contract within this period of time, then no changes can be made to the existing contract.
We have heard that you can purchase a property through a company name. Is this true? Our problem is the company provides my husband a housing allowance but the company policy does not allow you to purchase a property using this money. As the company has all the contracts signed off by them we need to avoid our name being on the documentation. If the above is possible would we still be able to raise a mortgage? RG, Dubai
A company can buy a property in its name but will only be able to pay for it in cash. If the company wishes to avail itself of mortgage finance, again this is possible but for commercial properties only, not residential. The only way your scenario would work out would be if the owner of your husband’s company would agree to buy a property in his/her name, then effectively lease it out to your family using the allowance given to your husband. To arrange finance he/she would have to follow the self-employed model and the documents required by a bank would include the following: Fully completed and signed application form, valid passport with visa page, six months’ personal bank statements for all current and savings accounts, last credit card statement, proof of residence (Dewa bill), two years’ audited accounts, copy of trade licence and share certificate, last 12 months’ company bank statements, copy of memorandum and articles of association, and copy of share certificate.
Can a new landlord increase the rent of all the flats in a building? Does he have to follow Rera rental index rules? If he violates the rules and puts an unjustifiable rental increase and makes the situation of every tenant in the same building unbalanced, how can we legally approach [the Rent Committee] as a group of tenants? AA, Dubai
A landlord has the right to increase the rent of a single apartment or multiple units, as long as the Rera rent calculator states so. This calculator can be found on the Land Department website www.dubailand.gov.ae If the landlord insists in pursuing an unjustified increase, then the solution is simple: go and open a case at the Rent Committee. I believe that each case has to be looked at separately as I do not believe that it is allowed to do so as a collective group.
Mario Volpi is the managing director of Prestige Real Estate in Dubai (prestigedubai.com). He has 30 years of property industry experience in the emirate and London. Send any questions to mario@prestigedubai.com
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