The Real Estate Regulatory Authority (Rera) index for Dubai has been updated, potentially affecting long-term tenants, according to an expert. Better Homes CEO Richard Waind announced that the Rera calculator was revised on March 1 to better align future renewals with current market rentals.
The calculator provides landlords and tenants with information on how much rent can increase upon renewal based on a benchmark rent for each community.
Waind suggested that the recent update to the calculator might lead to larger rent increases for tenants who have been in their properties for over two years compared to before the revision.
This could prompt some tenants to consider moving or downsizing, while others might decide to transition to property ownership.
This information was shared by Waind in an interview with Khaleej Times on Wednesday.
He explained that the areas likely to be most affected are those where rents have seen the greatest increase in the past two years, specifically central villa communities and waterfront apartment communities.
Executives in the industry observed that rents could rise by 10 to 20 percent in certain areas following the revision.
However, Waind anticipates that the changes to the calculator could ultimately lower rents in the long term.
“There were significant differences between renewal pricing and going market rates using the previous calculator. This discrepancy resulted in limited market activity. The lack of movement contributed to a shortage of available properties, particularly in popular villa communities. Higher renewal costs might stimulate market activity, potentially increasing the supply of homes in these communities and slightly lowering open market rents.”
