Wednesday, October 03, 2007

Dubai Rental Challenge

There is a group on facebook called "Dubai Rental Challenge". It's claims are quite remarkable:
Too many properties are left empty while rents are climbing out of control. Rents are inconsistant (internationally) with other regular living expenses.

When we get 100,000 members to this group we will lobby the necessary authorities to introduce laws that will help reduce the excessive rents being charged in Dubai.

Possible solutions are:

A) Force property owners to prove occupancy within 12 months of ownership/property completion.
This will force speculators out of the market and make all empty properties available to be lived in by needy owners and tenants.

B) Cap the 5% Housing Allowance charged in DEWA bills.
They say Dubai is tax free, well this is a tax! It's "apparently" taken to cover things like rubbish collection, street maintenance, etc., much like a council tax in many countries. So why can't this be a flat charge?

C) Cap the service charges applied to new developments, especially apartments.
Developers are known to instal their affiliate companies to manage new buildings and set high charges, this is nothing but extortion!

I was on radio last week discussing these topics and promissed to setup this group. So don't just moan about high rents in Dubai, join the group and invite everyone you know, maybe we will have some impact!

Other ideas to reduce rents are welcome, message me directly and I will add them to the group description.
The primary complaint seems to be that rents in Dubai are too high -- which is not unusual. What is unusual is the top demand -- to force property owners to prove occupancy within 12 months of ownership/property completion. Essentially, this argues that owners are keeping their properties empty to drive rents higher. This may be possible if Dubai property ownership was a monopoly, where the owner could restrict supply to increase price (and therefore overall profit) but I think it is quite impossible these days to have the words "Dubai" and "restrict supply" in the same sentence -- the entire city is one enormous construction site.

Does anyone know why rents in Dubai are going up so fast during a period of massive residential construction?

1 Comments:

Blogger dubai rent said...

Its true dubai have a lot of technical people.They have capability to reestablish the country new way.

3:35 AM  

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