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The essential guide for renting property in Dubai

On 05-12-2017

Are you going on a new assignment to Dubai? Are you moving with your family to start a new life in City of Gold? Are you a student discovering new and exciting education system in Dubai? Whoever you are, you will realize that renting property in a foreign land is not exactly like the ways of your homeland. In spite of transparent laws and clear agreements, one needs to look at the unique processes of the land before renting a property in Dubai.

Refer this document as the first step to view what a tenancy contract means and the terminologies used in a real estate rental transaction. The rental law is also clearly explained in this link. Round off your lack of market experience with the help of a reputed, registered real estate agent. With these tools in your armor, you are less susceptible to poor contractual terms while renting a property or leaving out vital information in a contract.

The basic understanding of renting starts with the term Ejari. Ejari (means My rent) is the initiative of Real Estate Regulatory Agency (RERA) to regulate and facilitate the Rental Market of Dubai. This system will make provisions of law effective that regulates the relationship between Landlords and Tenants in Dubai.

WHO PAYS FOR WHAT?

LANDLORD

  • The landlord will be responsible for any defect, damage, deficiency and wear and tear occurring to the Real Property for reasons not attributable to the fault of the tenant.               
  • The service charge for amenities will also be borne by the landlord.                                                                                                              

TENANT

  • Security deposit (5% of annual rent - 1 month rent that is refundable)
  • A year’s rent in advance by mode of cheques. Depending on the agreed number of cheques, the annual amount may be split into 1 to 4 payments. If your landlord agrees during negotiation, you may be able to increase the number of cheque payments further. 
  • Real estate Agency Commission (2-5%)
  • Ejari fees Dh195 for online registration of your rental contract.
  • Housing fee: Dubai Municipality collects housing fee for all general civic services it is providing, through utility bills from the Dubai Electricity and Water Authority (DEWA). Expat tenants are charged 5% of the rental value of their property as per the rental index of their areas issued by the Real Estate Regulatory Agency (RERA).
  • DEWA deposit. Learn more here.
  • Chiller/Gas deposit: Variable per provider

Now that you understand the financial aspect of renting a property, here’s what you will need to do before renting a property:

Search properties online on various popular real estate websites by using keywords that is of interest to you. You may also look at websites dedicated to only property or 1-2 types of property to make your search easier and more reliable. Ex: Compared to a general listing website, you can check a Real Estate website, further focused on only apartments or only villas or townhouses type of properties.

You can choose, compare and shortlist properties by neighbourhood, that you would like to rent and contact the agent or broker mentioned under the listing for a guided tour.

Once you select the property, make sure you are in agreement with the rental price and the number of payment cheques proposed by the landlord. If you need to negotiate, check with the licensed agent or the landlord if they are open for negotiation. Do this after ensuring that all maintenance issues will be resolved before move in date and renewal terms are worked out.

After agreeing to the terms, draw the contract and ensure all final transactions take place between the landlord and you. All rental cheques should be presented in your landlord’s name directly and agreement should be strictly between the landlord and you. The agent cannot sign the contract on behalf of the landlord through a power of attorney. In case you are renting through a property management firm, make sure all paperwork is vetoed by a real estate representative of law.

You will need to present document copies that include Passport, a valid ID, Deposit Cheque and Trade license to complete the transaction. In turn, the landlord needs to present Proof of ownership and passport copy before the agreement is drawn. Almost done, you just need to make sure you register your rental agreement on Ejari using this form. After a successful move-in, you can do your due diligence on rental increases by using this tool. This ensures your landlord does not over quote you on increasing the rent amount.

Happy renting!

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