Question: What’s changed with reference to the smart rental index introduced in Dubai at the start of this year, because I feel that my rent is now too high? Where can I go to ensure I’m not being overcharged? LV, Dubai
Answer: There are a few points to consider here. Firstly, the new Dubai smart rental index has improved how rents are calculated and, therefore, is more accurate.
Previously, the index was calibrated using only the average of similar units based on location and number of bedrooms alone. The new index is more sophisticated and uses artificial intelligence technology with real-time data, basing rent values from previous contracts as well as rates from new ones, too.
When speaking about apartments, the building they are situated in is now graded from one to five stars and, of course, the location is still fundamental when deciding on the new rent, but the index is now much fairer when it comes to comparing renewal rental rates with vacant unit market rates.
Your landlord has to give you 90 days’ notice for any changes to your renewal contract and you must agree to these changes for them to take effect. If the notice for changes is less than 90 days, legally speaking, there should be no changes allowed at all, even if the index states that an increase is permissible.
Ultimately, if you feel you are being exploited by your landlord, you can always file a case at the rental dispute centre, located on the first floor of the Dubai Land Department building in Deira.
Q: With all the positive talk in the market about how real estate is doing, I’m planning to buy an off-plan property, but I’m worried about the legal ramifications should the project not be handed over on time. What legal options do I have if this is the case? SP, Dubai
A: Any off-plan project is subject to the terms and conditions of the sale and purchase agreement. This is the contract between seller (developer) and buyer, and it outlines all the necessary details of the sale and purchase.
It will have clauses inserted that pertain to many points, the purchase price, the completion date, compensation details in case of breaches and, of course, any force majeure issues, too.
There will be other clauses or items in the SPA, not just these mentioned here. In addition, the SPA will outline the responsibilities of both the seller and buyer, and these parties should adhere to this agreement.
It is important to note that a developer is allowed by law to be delayed by up to 12 months beyond the date stipulated in the SPA, after which the buyer can seek compensation in one of two ways.
Firstly, they can go to the Dubai Land Department to settle the matter. This is according to bylaw 13 of 2008, which states that the DLD may offer conciliatory measures in order to attempt to find a solution between the parties.
If an amicable solution cannot be found, you are at liberty to file a civil case against the developer via the Dubai Courts, where a judge will decide if you will be entitled to any compensation for the delay in handover, based on the details and clauses written in the SPA.
The opinions expressed do not constitute legal advice and are provided for information only. Please send any questions to mario@novviproperties.com
