Many Dubai tenants must decide fast to renew leases or not as RERA’s ‘market rates’ come into play

Many Dubai tenants must decide fast to renew leases or not as RERA’s ‘market rates’ come into play

Rent increases are set for another double-digit increase across locations in Dubai, particularly on apartments. Image Credit: Bloomberg

Dubai: The coming weeks will be decisive for many tenants in Dubai as they have to decide whether to renew their lease or opt for a brand new rental option. Especially with the summer break coming up, they will need to make those renew or shift decisions fast.

But it is unlikely these will be easy decisions, because this year renewals will feel the full impact on the recently revised RERA Rental Index, which now gives landlords greater flexibility to set their rents in sync with the market average. That means there could be increases of up to 20 per cent when a tenant receives his offer for a lease renewal.

Whereas before the update, landlords had to – in most cases – stick to a particular percentage range when hiking their demands.

“The revised (RERA rental) calculator now provides a more accurate reflection of open-market pricing, enabling landlords to implement significant rent hikes at a time when market rates are finally starting to ease,” says a new Asteco report.

Those ‘significant’ rental increases could then be the trigger for existing tenants to