DUBAI 3 May 2019: Dubai is considering a three-year freeze on accommodation rentals to help stabilize the market, according to reports.
The move is being considered by the Dubai Land Department and will help both tenants and investors [home owners] by avoiding fluctuations in the rental market.
Lewis Allsopp, CEO of Allsopp & Allsopp says “If the 3-year rental freeze is to come to fruition this will benefit tenants in the market greatly by adding confidence and stability. The Dubai Government is continually taking steps to make the city a home for expats rather than a transitional phase.”
Tenants can rest assured that they have a maximum rental price guaranteed for 3 years which helps them towards saving for their future plans. They will know that a certain amount of money can be saved over this 3-year period and can perhaps be put towards a down payment on a home in the city, he added.
Investors Benefit Too
Home owners will also benefit as rentals have been continuously declining due steady supply of new units into the property market of Dubai. For the next three years, investors will be guaranteed a steady fixed income on the units they rent out.
“Commercial tenants will benefit from the 3-year rental freeze, especially those looking to rent in the higher end towers in the city. These towers can often come with a 5% rental increase after the second year. However, commercial rental deals can often be a lot more complex than residential. Larger commercial deals, for example, may be more than a three-year contract and negotiations can vary within these deals. In this case, the three-year fixed rental contracts may have less of an impact,” said Emrah Yar, Head of Commercial at Allsopp & Allsopp.