Always remember that your real estate broker is here to help. They are the ones with the expertise, so if you have any questions, always make sure you ask them. Should you ever be in doubt, you can contact RERA directly and they will assist you with any issue that needs to be addressed.
Tip 1: Be prepared to rent your property
When you have an investment property to lease to a tenant in Dubai, always remember that the property is yours, however you are leasing to another person and it will become their home for the period they are staying there. A well-presented property will always lease faster and for a better price, so be sure it is freshly painted and cleaned. Have your listing agent address all potential maintenance issues in advance. Just as landlords want good tenants, all tenants want a good landlord.
An investment, of any kind that is not being serviced, is losing much needed revenue, so minimize the loss by having your property listed and priced correctly. Every day you have a property empty you are losing money so to hold out for a dream rental price is just that, “a dream”. In Dubai all properties have a maintenance service charge that is payable via the owner. So in conclusion an empty property is losing rental and is still incurring additional maintenance fees. In a competitive market never over price a property and have it without a tenant, as it just does not make financial sense.
As a landlord, your property should be handed back in its original condition at the end of a tenancy contract. Tenants have no right to alter or renovate the property unless the owner agrees. For your own protection, a condition report should be made by your agent to prove how the flat looked before moving in so you have a reference when the tenant moves out.
Always remember you as landlords, have rights too. You may evict tenants before their contract expires if offences are committed and specific violations based on Law No (33) of 2008. These also include failing to pay the rent within 30 days after the notice is given to them, subletting the property without the landlord’s written approval, using it for illegal purposes, damaging the property and making it unsafe for its users.
Tip 5: Contracts and periods
In Dubai, all tenancy contracts are based on yearly renewal, so if you wish to increase the rental you will need to have your agent check the yearly rental review from the Dubai rental committee first. If this is in your favor then you must also issue a notice 90 days before the expiration of the contract. If you wish to change any other conditions to a contract the same applies and is subject to both parties agreeing in writing. This will need to be in writing and be notarized from the Dubai court. There is also a break lease clause that is included in the tenancy contract which is advised to be, 30 days’ notice with 2 month rental penalty to the tenant.
Receiving payments for rental accommodation in Dubai may be very different to what you’re used to in your country of origin. At the beginning, you will be given a security deposit from a tenant to secure the property, this is typically 5% of the annual rent or 10% if the property is furnished. This is only payable to you when a tenancy contract is signed, or if a tenant backs out of a deal once a reservation form has been signed by them. Instead of paying monthly for the rent, payments are typically given in one, two, three or four cheques spread throughout the year. For example, these are often provided to yourself at the beginning of the contract, with one of the cheques being current and three being postdated. The reason we advise landlords to take cheques is they act as a form of security if the tenant breaks the contract. In order to protect a tenant, the broker should supply a copy of the cheques. This way the tenant has physical proof of rental payments should a dispute arise.
Payments for services such as DEWA and Air conditioning are made in the name of the tenants, and a paid full and final bill should be issued to your agent at the vacating of the tenants. This is used when the new tenants move in to your property and a new account, in their name, is opened. As a landlord you will also need to be registered with the service providers and a security deposit is payable from yourself. This amount is held in your name and used should a tenant abscond or leave the property without paying any outstanding amounts. This deposit is returnable to yourself from the service provider should you sell or dispose of your property to another owner. In all case the maintenance fees for the property also has to be up to date and a paid account supplied before a tenant should move in. This is because access to car parks and beaches along with pools and gyms are subject to the use of active access cards. These will not be activated if maintenance fees remain outstanding.
On a tenant vacating, all possible outstanding maintenance issues and service bills from the said tenant are to be paid in payable, and a cleared paid account must be supplied. Should any accounts still remain outstanding after the tenant vacates, you will still hold the security deposit which was given to you at the time of reserving the property, or on the signing of a tenancy contract. In this case the deposit can be used to clear off any outstanding matters.