Can I increase the rent based on the contract signed instead of the RERA rent calculator?

Question:

I bought a 1 bed in Green Community in Oct 2013 which was already rented out. I renewed the contract with the same tenant in March 2014 (as the previous owner had not issued a vacant letter). Till date the tenant has not provided me his passport copies to complete the Ejari. In fact, until August he did not even have a valid visa. He told me that in September he will be renewing his visa soon as he is having problems with his sponsor. I have sent him several emails for reminders for the Ejari but he never responds. He does not even respond to sms’s and phone calls. On the tenancy contract I have the condition to increase rent by up to 20%. Can I ask him to vacate the premises upon next renewal?  Can I increase the rent based on the contract signed instead of the RERA rent calculator?

 Answer:

Thank you for your email.

Firstly, your tenant has to have a valid visa otherwise he cannot legally rent the property, so if he cannot produce a valid visa to date, you can affect an eviction.

Registering the tenancy contract is mandatory and without this registration it is difficult to perform other procedures such as sponsoring family or domestic help/ nannies etc.

Raising the rent can only be done as long as 2 situations are fulfilled. You have to give 90 days’ notice prior to the expiration of the lease of any changes to the contract and this obviously can include the rent. The second is to check what the RERA rent calculator states is the permissible increase. Having an agreement on the contract is fine as long as you continue to enjoy the agreement from both parties, if your tenant challenges the increase on the contract, the law (rent calculator) will prevail

The above answer has been brought to you by Mario Volpi who is the Managing Director of Ocean View Real Estate in Dubai. Mario has 30 years of property industry experience in Dubai and London.

The advice provided in our columns does not constitute legal advice and is provided for information only. Readers are encouraged to seek appropriate independent legal advice.

 

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2 thoughts on “Can I increase the rent based on the contract signed instead of the RERA rent calculator?

  1. Hi,
    My tenancy contract is due for renewal in May’15. It was agreed with the real estate agent to renew at the same rent, & which is as per the prevailing rental calculator index. I prepared the cheque for rent (1 payment), but the real estate agent refused to accept it, stating that I need to pay the agency commission. I told the agent that for renewals, agency commission is not paid. Please advise what future course of action i have, so as to renew the contract before its expiry.

  2. Hi John,

    Thank you for your message.

    Per the RERA training manual (page 46) an agent is not allowed to charge to renew a tenancy agreement. With that said, one should also consider the efforts that an agent might put forth to facilitate the renewal. Are any fees incurred such as courier fees? How difficult is it to reach the landlord? You would be the one to know the situation the best. If you feel that not much effort is needed to renew your tenancy, you can create a RERA Certified Tenancy Agreement online here. Simply fill it in online, print and/or email it to your landlord for signature.

    I hope this helps.

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