Landlords must give 90-day notice to increase rent in Dubai

Gulf Today, Staff Reporter

The implementation of the Smart Rent Index by Dubai Land Department (DLD) has been instrumental in stabilising rental prices and mitigating overall inflation in Dubai for 2025. By effectively regulating rent increases, the index has contributed to maintaining a balanced cost of living in the city.

The index utilises artificial intelligence to deliver accurate and standardised rental price assessments to cover all residential areas, including key districts, special development zones, and free zones. This enhances market transparency, ensures fairness, and strengthens confidence in Dubai’s real estate sector.

The new rental value adjustments are determined by a smart index, which calculates the applicable increase based on data drawn from multiple factors, including rental contract values in the building, the average rental values in the area, and the building classification.

Furthermore, a clear framework has been established to manage rent increases, considering the timing of the landlord’s notification to the tenant and the contract renewal date.

Eligibility and Implementation Mechanism for Rent Increases

This mechanism stipulates that if a landlord notifies the tenant of a rent increase at least 90 days before the contract’s expiration, the increase will be applied only if the Smart Rent Index confirms the property’s eligibility.

However, suppose the new index indicates that the property qualifies for a rent increase, but the landlord did not notify the tenant at least 90 days before the contract’s expiration. In that case, the increase will not be applied.

In cases where the landlord provided the required 90-day notice and the previous index supported the increase, but the new index does not, the renewal date will determine which index applies:

- The previous index will be applied if the contract was renewed before 2025.

- The new index will be enforced if the contract is renewed during 2025.

Ensuring Transparency and Enhancing Market Fairness

Majid Al Marri, CEO of the Real Estate Registration Sector at Dubai Land Department, emphasised that the recent launch of the Smart Rent Index marks a significant step toward ensuring transparency in rent determination while reinforcing Dubai’s commitment to digital transformation and market fairness.

He added: “The Smart Rent Index helps curb inflation and enables stakeholders to make informed investment decisions based on reliable data.”

Al Marri further explained that the index establishes clear and standardised criteria for determining rent increases, aligning them with actual rental values and market trends. This comes at a time when confidence in Dubai’s rental market continues to grow, with over 900,000 lease contracts registered in 2024 — an 8% increase compared to 2023.

As part of its commitment to market adaptability, Dubai Land Department will regularly update the Smart Rent Index to reflect rental market dynamics, ensuring a fair and balanced approach for landlords and tenants across the emirate.