A law issued by President His Highness Sheikh Khalifa Bin Zayed Al Nahyan on Saturday capped rent increases in Abu Dhabi at five per cent annually.
Shaikh Khalifa, as Ruler of Abu Dhabi, issued Law No. 6 of 2009 making amendments to Law No. 20 of 2006 regulating the landlord-tenant relationship, WAM said.
The law covers properties leased for housing, industrial, trade or professional activities. It is applicable to existing contracts and those that are signed after the law takes effect.
The law is not applicable to agricultural land and buildings, land and properties owned by the government, as well as land and properties designated for Adnoc to rent them for industrial purposes specified in petroleum services. The law also exempts properties leased for hotel and tourism purposes, including hotel apartments, as well as housing occupied to work conditions.
If the contract duration is three years or less, a rent increase of no more than five per cent is allowed once every year. The annual rent increase is calculated from the date of the latest tenancy contract, or the date of the latest rent increase.
The rent may be increased or reduced upon a decision from the chairman of the Executive Council. The tenant has the right to file a complaint with the Rent Committee.
The law stipulates a written tenancy contract and lays down obligations of landlord and tenant.
The committee is allowed to lower the rent rate specified in the contract and impose a fine on the landlord if the specified rent cap is exceeded, or for non-compliance with the committee’s decision to re-correct the violation.
Under the new law, the tenancy contract is valid to the end of its specified duration and is renewed for a similar duration term or for many terms, unless one party announces its wish in writing to vacate the leased property, or amend the terms of the contract.
Tenants shall announce their wish to vacate the leased property for housing two months before the expiry of the contract.
The landlord is not allowed to ask the tenant to vacate the leased property except after four years. The tenant has the right to renew the tenancy contract, which is less than four years, for one or more terms under same terms and conditions.
