Of the various people in the property industry with direct relations marked with sometimes serious complications, it is that which is between landlord and tenant that is usually rife with complexities and issues.
To help us understand that this relationship need not be so controversial, Mohanad Alwadiya of Harbor Real Estate shares his thoughts.
What are some common issues between landlords and tenants?
The three most common issues that arise from the landlord-tenant relationship usually involve disagreements regarding a proposed
rental increase, unjustified eviction, and delayed rental payments. Most disputes regarding rental increases arise where the landlord attempts to increase the rental significantly in order to capitalize on the revenue potential of the property. There have been a growing number of landlords who have attempted to do this with the recovery of Dubai real estate gathering more momentum and increasing market averages for rental receipts. The issue arises when the gap between the current rent payable and the new proposed rent, while seemingly justified when compared to ascending market averages, is too great for tenants to bear. The obvious issue for tenants is that a sudden and significant hike in rental expenses can put pressure on the family budget and necessitate, in some instances, relocation.
Rental disputes in Dubai are currently managed by the Dubai Rent Committee, a body which resides within the organizational structure of Dubai Municipality. There are specific laws governing the degree to which a landlord can increase rent in Dubai and Decree No.2 of 2011 sets out what a landlord can and cannot do with regard to increasing rentals for existing tenants. Both tenants and landlords can visit www.dubailand.gov.ae and access the RERA Rental Increase Calculator to determine for themselves as to whether any rent increase is applicable in accordance with the law.
What are the ways by which landlord-tenant relations can be improved?
As with all contractual relationships, the operation of the contract will always be more effective and efficient if
• understands and accepts both parties’ rights and obligations according to the wording, provisions and clauses included in the lease agreement;
• complements the above point with a thorough understanding of the law. Quite often, disputes arise out of ignorance, and not necessarily deliberate or malicious intent;
• has the commitment or willingness to resolve disputes through arbitration and reconciliation, supported by sufficient knowledge of each party’s rights and obligations. Quite often, a mediated discussion can reach a solution without the involvement of the Rent Committee.
Of course, the parties must have recourse or access to arbitration and reconciliation processes and procedures and, where these fail, a judicial process which is empowered to provide decisions bound and enforceable by law. In this regard, we are genuinely excited at the prospect of having a world-class Rental Dispute Settlement Centre, scheduled to be operational from December, which will further the development of Dubai as a global leader in all aspects of the real estate and property industry.