Fear of eviction grips tenants in Dubai

The soaring demand for high-end properties in Dubai has led to rising rental prices, putting tenants under pressure, and increasing the risk of eviction. Dubai’s land laws permit landlords to serve notices to tenants if they want to sell a property or occupy it for personal use.

As Dubai’s high-end property sales see a surge, a large number of NRIs, including Keralites are a worried lot as the rentals of apartments and villas are also on the rise. 

The property owners are cashing in on the current boom. As selling the property, or getting a new tenant becomes lucrative, the tenants are feeling the heat. 

Legal experts say that there is a need for a balanced approach to protect the interests of both the landlords and the tenants.

"The upward trajectory of rental prices in Dubai's residential market underscores the need for a balanced approach that considers the legal protections afforded to both landlords and tenants,” said Mustafa Zafeer O.V, founder and chairman of Musthafa & Almana, a legal firm based out of the UAE, with presence across five continents.

Soaring rentals

Rentals have been on the rise in Dubai after the Covid-19 economic downturn. A good accommodation would cost a tenant anything between 50,000 dirhams to 300,000 dirhams a year. As the landlords step up demand for higher rentals, the tenants are either forced to pay up, or face eviction. 

The situation is especially tough for those living independently compared to those living in accommodations arranged by their employers. “From a commercial perspective, the escalating rent poses challenges for individuals and families seeking affordable housing options, emphasizing the importance of proactive measures to address housing affordability concerns," Mr. Zafeer said.

RERA’s role

Dubai’s Real Estate Regulatory Authority (RERA) has made it mandatory for landlords to get its permission before demolishing a flat or villa. The landlords can also ask the tenants to vacate the property for their own use or for the use of their immediate family. 

The tenant's obligations include not subletting the property, not damaging the property, and paying rent annually or monthly as per the agreement.  

“Against this backdrop, a comprehensive understanding of leasing regulations and market dynamics is essential for fostering a harmonious landlord-tenant relationship while promoting sustainable growth in the real estate sector," Mr. Zafeer added.  

Rental regulations  

The RERA had revised the rental index in March this year to make the rentals conform to market rates. The authority's website publishes rental rates for each locality. The RERA also permits an annual increase of up to 15%. It also stipulates that 5% of the rental amount will go to the government.  

Dubai was ranked first in the world for the number of houses that were sold for upwards of $10 million in 2023.

According to international property consultancy Knight Frank, “105 homes priced in excess of US$ 10 million were sold across Dubai during the first three months of 2024, up 15% on Q1 2023.”

The report, released in July said, “The level of deal activity in Dubai continues to strengthen, particularly at the top end of the market, where demand from high-net-worth individuals vying for the city’s most expensive homes persists.”