Dubai is a popular second home for people across the globe as the city has become an international property hotspot. Its top class lifestyle, cosmopolitan atmosphere and sub-tropical climate attract all.

Dubai offers a wide range of housing options that range from studio to penthouse and if you wish to settle in Dubai you could either purchase a freehold apartment or rent an apartment with the help of an agent.

The land registrations and real estate activities in Dubai are overseen by Dubai Land Department and its affiliate, Real Estate Regulatory Authority (RERA). RERA is a nodal agency that formulates, regulates, manages and licenses various real estates related activities in Dubai.

Dubai Land Department, the Real Estate Regulatory Authority and the Rent Committee have implemented the new rent cap. Accordingly most rental or lease agreements in Dubai are renewed annually. If the same Tenant wants to renew the lease agreement for a 2nd year, the rental amount, as well as the terms and conditions of the agreement will stay the same. Should the same Tenant wish to renew for a 3rd year, the Landlords can only raise the rent at the time of renewal, by 5%, in Dubai (effective since Jan 1, 2008).

In Dubai, rents are normally paid for the entire year up front, either in cash or cheques. Cheque payments are restricted to 1, 2 or 3 installments. Since the rents are leveling off landlords have introduced a 12 cheque payment system also. All landlords require the Tenant to pay a refundable security deposit that is usually 5% of the annual rental amount. An additional deposit of AED 1,000 to 2,000 must be paid to the electricity/water (DEWA) provider of the emirate you are residing in when you move into the property. A few emirates also expect Tenants to pay municipal tax on the leased property.

Register your rental contract in Dubai
The Real Estate Regulatory Agency (RERA) of Land Department has made it mandatory for all rental contracts to be registered through its arm called Ejari (Arabic for ‘my rent’). Rental contracts can be registered by either the landlord or the tenant, or both parties without the need to consult each other.

One of the major benefits of registering your rental contract is that it is currently free of cost to register. Also, in case of any dispute between tenant and landlord, you will need to approach the Rent Committee at Dubai Municipality, who now require a registered rental contract from RERA, before settling the dispute.

We hope this guide will help you decide whether Dubai is the right location for your second home or investment property.