Real Estate in the UAE: How quickly can I evict a tenant during a two-year lease?

Question: I am planning to purchase a property, and the tenant has a two-year lease that started in April 2023. The annual rent is also significantly below the market value. Can I terminate the lease by providing a notary notice 12 months before the property transfer date if I want to move in? Is this the earliest option for the property owner to move in?

During the two-year contract, there is no possibility to increase the rent. However, are there other options I can consider? DB, Dubai.

Response:

When a tenant confirms a two-year lease agreement, you are correct in assessing that the rent cannot be increased, as technically this can only be done 90 days before the lease expires. Thus, any rent increase cannot be communicated until the beginning of 2025. The only way to potentially increase the rent would be to have a conversation with the tenant to see if they would agree to something more reasonable. My advice is to do this 90 days before the anniversary of the lease, considering that the rent is below market price. Once you become the legal owner of the rented property, you can send the tenant a notarized eviction notice for 12 months due to occupancy by your own family or first-degree relatives. After this period, that will be the earliest time you can occupy the property. It is important to note that if you used this reason for eviction, you will not be able to rent out the property for two years from the date of eviction. There may be complications with this: if the tenant contests the eviction notice, they can file a claim with the Rental Dispute Resolution Committee, and the judge may decide that the tenant cannot move out until the end of the two-year lease, which will occur in April 2025. Of course, this is not definitive.

Question: I know that rental prices in the real estate regulatory agency's index are calculated based on the number of rooms and the location of the property. However, what should be done if an apartment consists of one bedroom, a hall, an additional "single bedroom," and two bathrooms? How will this be interpreted if the single bedroom cannot be classified as a real bedroom? How will the increase in rent for such an apartment be interpreted if the Rera index is based on the number of rooms? SU, Dubai.

Response:

The description of the property is determined by the information contained in the title deed. In your case, if the deed states that the property has two bedrooms, then this is what the rental calculator will use when renewing the lease. According to the Rera index, residential properties with tenants have lower rental rates compared to vacant properties. However, if the deed states that the property has one bedroom but there is an additional room, such as an office, that can be used as an extra single bedroom, it will still be considered a one-bedroom property. Again, the calculator will indicate how the rent should increase based on this description. However, if you are the owner and believe you are missing the opportunity to raise the rent, considering that the deed states it is a one-bedroom apartment, you can apply to the Dubai Land Department to amend the title deed. This will require a visit from a representative of the Dubai Land Department and the payment of the appropriate fees to clarify whether it is a one-bedroom apartment plus an office or a two-bedroom apartment.

Mario Volpi is the Sales Director at AX Capital. He has been working in the real estate sector for 39 years in London and Dubai. The opinions expressed are not legal advice and are provided for informational purposes only. Please send inquiries to [email protected]

Updated: September 14, 2023, 3:30 AM.