The Dubai Land Department’s rent valuation service is rapidly becoming recognized as essential for resolving any dispute in lease talks between landlords and tenants. Market sources claim that the valuation is completed in a matter of days and is now accepted as the final decision by all parties engaged in rent talks.
“We are talking about the process getting completed in about 7 days,” said a landlord who has in the recent past used this service – available through Land Department’s REST app – to close out agreements with tenants. “The valuation is done by a respected third-party – DLD – and made up of officials who have sufficient knowledge of rental market dynamics and valuations.”
The price range is high, starting at Dh2,000 and going as high as Dh10,000. All kind of rental properties, including shops and buildings for offices, are included. However, the service is used most frequently on the residential side.
The valuation services are used by landlords who believe that the existing rentals for their apartments or villas are significantly lower. The same goes for renters who believe their landlords’ increases are excessive for the neighborhood or building in question.
Less expensive
“Rather spend the Dh2,000 to get a fair valuation rather than have to spend much more on relocating to a new apartment,” said one tenant, who was able to rework the lease terms with her current landlord after the valuation. “The valuation ended up as a win-win for both parties.”
After Dubai’s residential rents increased by 20–25% from mid-June 2021, the requirement for an appraisal is urgent. Only a small number of places were able to see a less sharp increase, but even there, according to market sources, rents have been rising recently.
Rental Index
For landlords who feel that the Dubai Rental Index doesn’t accurately reflect the changes the market has gone through in the last two years, the Land Department valuation service has also proven to be helpful. They claim that the Index scores are still hovering around 2018–19 rates.
“So, when a valuation gets done on what the ideal rent should be now, it helps landlords ask for a fair hike during renewals,” said a market source. “Once the valuation gets done, that revised rent would become a sort of de facto standard for that area.
“The rental market requires balance and the Land Department service offers that.”
Rental Court
The long-standing Rental Disputes Centre and the valuation service strengthen Dubai Land Department’s position as the authority on rental disputes. As Dubai faces the fastest rate of rent hikes since 2016–17, there is still a rush to get decisions from the RDC.
“The valuation service is primarily for properties with existing leases,” said a market source. “Because if it’s a brand new unit, the landlord can set a rental he believes is in sync with the market trends.
“But on existing leases, the chances of disagreements over what the revised rent should be will always be there. The valuation by the DLD helps clear the air, relatively quickly.”
This is something that more landlords and tenants in Dubai are finding.