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Calculate your rent
Rera launched a rental calculator on its website on Wednesday, although it’s a far cry from the update index we were promised. Meanwhile, Landmark Properties will publish an updated index next week. This is getting interesting.
April 30, 2009 12:47 by Dana El Baltaji
The Real Estate Regulatory Authority (Rera) introduced a Rental Increase Calculator on its website on Wednesday evening, although it did not provide the updated rent index it had vowed to release before the end of April.
The rental calculator provides residents and landlords throughout the emirate guidelines on fee increases. The guidelines are based on rental prices that are significantly lower than those published in its index in January 2009.
According to the rent calculator, the fee range for a four bedroom villa in Al Barsha is between AED200,000-AED240,000, compared with Rera’s index range of AED250,000-AED300,000.
The index was criticized for failing to reflect the dramatic drop in prices in Dubai’s rental market, and for giving landlords throughout the emirate cause to raise rents. According to the rental index, yearly fees that fall below the average charge for a particular district can be increased by landlords up to 20 percent.
Rera indicated at a press conference in February that due to drastic changes in the rental market, the index will be updated. The authority advised the media that it would be published before the end of April.
“We will know [the updates] from the beginning of April, because people have just started registering on ejari and it is from this that we will know the drop,” Marwan bin Ghalita, Rera’s CEO told reporters. Ejari is the website where landlords must register tenancy contracts.
A Rera spokesperson will not confirm if the index will be updated.
Meanwhile, real estate-consultants Landmark Properties will release an updated rental index next week, which the firm claims will reflect Dubai’s letting market more accurately. It published an index in March titled Rental Guide – March 2009: Lease Rates in Dubai.
Rental prices in Dubai have fallen considerably since the market’s peak in July 2008. Property consultancy firm Asteco released a report titled Dubai Report in early April, claiming that apartment and villa rents in the emirate have fallen by 22 and 34 percent respectively in the first quarter of 2009, as compared to the prices in the fourth quarter of 2008.
Another report by investment firm EFG-Hermes claims Dubai’s rents have fallen between 20 to 50 percent in 2009 as compared to 2008, depending on the location of the building.