Dubai property laws mark a 'major step' (page 2 of 2)

Both of these are quite a big step, and you can really see a fundamental change taking place.'

Dubai rent cap laws

Investors who have leased their premises for a period of time that they feel leaves them unable to maximize potential profits from their units due to the rent cap laws, could see further changes in regulations.

Currently all disputes can be taken to the Rent Committee, which issues rulings on a case-by-case basis. However, there is no guarantee of whose favour the judgement will fall in, even if rents have not been raised for a matter of years, leaving a huge disparity between the rental income and current market values.

'There has been talk, but this is unconfirmed, of there being a change to the rent cap law next year, so landlords could see what the current market price was and charge accordingly. This could maybe be by looking at Rera's price index, and tenants could then make an informed choice on whether they wanted to stay in place or not.

'The Land Department might also come up with standard industry contracts for landlords to use; it could be something along the lines of three years for residential ones and five for commercial leases.

'There are still loopholes however. It's hard to sell on properties that have tenants in situ, but if a landlord evicts the tenants by saying that they'll move in and then sell it on within the year then what happens? They're not allowed to lease it to someone else within that time frame, but are they allowed to sell? So the Rent Committee would still have to pass the rulings on situations like that.'

See also:
Dubai prices likely to see correction 'by 2010'
Dubai homeowners face impact of increased charges