Are you considering renting a property in the UAE and finding yourself in a perplexing situation with your real estate broker? Welcome to the world of diverse practices in the vibrant real estate market of the United Arab Emirates. One reader from Dubai has raised a compelling question: "Can an agent demand a gift for negotiating rent?"

Let's break down the nuances and explore whether these demands are the norm or an exception in the UAE property landscape.

Renting Rituals in the UAE: A Different Dance

The reader raises concerns about their broker's request for a full year's rent upfront before providing a signed tenancy contract. This practice might seem peculiar, especially for those accustomed to the UK's rental norms. In the UAE, however, many agencies operate differently.

Typically, brokers aim to bring both tenants and landlords together to finalize agreements and exchange cheques for rent, deposit, and commission. However, if this is not feasible, the tenant may sign first and then deposit the cheques with the broker. The broker then hands over the cheques to the landlord after both parties have signed their respective parts of the contract.

While the order of proceedings may vary, what matters is adherence to proper paperwork, receipts, and agreed-upon procedures. So, handing over rent cheques before signing the contract isn't necessarily risky if all parties are on the same page.

Gifts for Negotiation: A Twist in Tradition

Now, about the broker's request for a gift or cash in exchange for negotiating the rent – this is not a standard practice. Typically, tenants pay the statutory 5% plus VAT commission to the agency, and extra gifts are not obligatory. If you feel the agent deserves recognition, that's your choice, but it's not a requirement.

Rent Hikes and Email Surprises: What's Legal?

Another reader inquires about a landlord's 20% rent increase notification received just 38 days before the lease renewal. Technically, as long as the landlord informs the tenant of proposed changes 90 days prior to the contract's expiry, they can proceed with these changes. However, not specifying the exact increase amount within the 90-day window seems counterintuitive.

Despite the lack of specifics, the changes can still take effect at the time of renewal, given the notice was provided. It's a quirk in the system that tenants should be aware of.

The Mystery of Unspecified Rent Increases: A Landlord's Tactic?

In a different scenario, a tenant is faced with a landlord requesting a rent increase through email without disclosing the amount, only to be discussed in person. Additionally, the landlord passes on a 20% sub-lease fee to the tenant. Can the tenant seek refuge in the Dubai Real Estate Corporation (DREC) or Rent Dispute Settlement Committee (RDSC)?

Seeking guidance from the RDSC can provide clarity on whether the landlord's actions are reasonable. If deemed unreasonable, the RDSC can advise on filing a case that will be presented before a judge. However, when it comes to sub-leasing, seeking legal advice is crucial as the laws may not cover this aspect in great detail.

In Conclusion: Navigating the UAE Property Maze

The UAE's real estate market boasts diversity in its practices, and what might seem unusual to one may be standard for another. As with any property transaction, understanding local laws, seeking legal advice when needed, and ensuring clear communication with all parties involved can help tenants and landlords navigate the intricacies of the UAE property landscape.

Mario Volpi, Sales Director at AX Capital, provides valuable insights, emphasizing that opinions expressed do not constitute legal advice. Have questions or need advice? Reach out to m.volpi@axcapital.ae.

In the dynamic world of UAE property, staying informed is your key to a smooth rental journey.