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Sunday, November 13, 2005

Moron Rents

Oops, that title should have been 'More On Rents'. In the wake of yesterday's reports of a cap of 15% on rents for commercial and residential property, today's papers are full of praise for the decision. However I still think that landlords will abuse it and view it as a mandate rather than a maximum.

Dubai Municipality's Rent Committee will be responsible for enforcing the decision, and unless they change their procedures but quick, it will result in a lot of disappointed people. The problem is that the DMRC has a lengthy and quite public procedure. It involves publication of names and addresses of complainants, and that process can easily exceed any agreed notice period between landlord and tenant. Many tenants facing rises of up to 40% when they are supposed to renew in the next few months are doubtful that these proposed rises will be reduced in line with the new order. And they are sceptical about approaching DMRC, fearing that if they cause any trouble they will be evicted anyway.

What is needed is a very simple, anonymous complaints procedure. If you are facing a rent hike of more than 15%, you simply submit a copy of your existing lease agreement, along with a copy of the letter from your landlord advising you of the proposed new rent. The Committee will then know which landlords are doing the dirty and can sort them out. There is no reason for the landlord to know who complained, and the Committee should guarantee the anonymity of complainants. Easy-peasy, lemon-squeezy.

We have Khaleej Times, our favourite number one newspaper to thank for this ruling, by the way.

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