Dubai authorities have decided to change terms for official rent index update, regulating prices in rental market. Now the index will be updated only once a year.
Rent Index previously updated by Dubai Land Department every four months since its launch in 2009 is intended to reflect the main price trends in the Dubai rental market. Its update was provided in order to increase transactions and pricing transparency in the lease segment, and also in order to facilitate the interaction between landlords and tenants.
“After reviewing and studying the feasibility of issuing three indicators each year, and how it affects the submission of the increase in rates and the amount of impact coming from the data recorded in updating the index, we have adopted the issuance of one indicator per year starting 2015,” the DLD said. In a translation from the official language, it means that the Department is concerned about how index update influences the rise in prices in the rental segment.
Besides, Dubai has long had debates about how fully current rent index describes all the factors affecting pricing in the lease segment. In this regard Dubai Real Estate Regulatory Agency (RERA) intends to modify the index during the current year, in order to account other factors such as window view in the rented property, the presence or absence of different amenities in the apartment, villa, and the residential building itself, the age of the building, etc.
Thus, the new rent index update will come only in January next year, according to the Department. While the index previously showed rental prices only for the last four months since its last update, now the picture is more complete, and it is possible to see data for the whole year.