UAE Property: How is Dubai's New Rental Index Different from the Old One?

The old rules will still be used to calculate rent increases when the market goes up

Question: I recently read about a new smart rental index launched for Dubai's real estate market. Can you explain what this is and how it’s different from the old one?
— CT, Dubai

Answer: The Dubai Land Department has introduced a new version of the old Rera rental calculator. Now called the smart rental index, it started on January 1, 2025.

There are several changes, but the main difference is that the new index uses real-time data and artificial intelligence (AI) to determine rental prices. The old system only updated rent once a year. The new system updates rent values all the time, making them more accurate and transparent. However, the existing rules (Decree 43 of 2013) will still be used to calculate any percentage increases in rent when the market goes up.

The new smart rental index uses three main factors to set future rent prices:

• Old and New Rental Contracts: Information from past and current rental agreements through the Ejari system.
• Building Rating: Buildings are rated from one to five stars based on their quality and facilities.
• Location: Where the property is located.

Right now, only entire buildings are rated, not individual apartments. For villas, the actual property will be rated in the future. Commercial properties will also be included in the new index later this year, probably by the second quarter.

Video: Watch this video for more information

Question:

I rent a three-bedroom apartment in Al Wasl and have been living here with my parents since 2009. The building has a gym and swimming pool, but they are never used. Most of the building is for businesses, and we are one of the few families living here.

My rent was Dh100,000 ($27,225) in 2020. It dropped to Dh90,000 in 2021 after Covid-19, but has been going up steadily since then. At the same time, maintenance has gotten much worse.

We wanted to move a few months ago, but because of the rent increases, a family medical issue, and difficulty finding a new place, we hope to stay another year. We received a notice to increase our rent from Dh107,000 to Dh128,400, which is a 20% increase. This is not according to Rera's rules, which allow only a 15% increase. The Rera website calculator shows there should be no rent increase for our unit.

When I talked to the management company, they said the landlord did a building assessment with the Land Department and has a certificate that allows him to raise the rent.

Do you have any advice for me, or am I stuck with the landlord? I don’t want to start a rental dispute.
— JG, Dubai

Answer:

Since you mentioned this, the Land Department has introduced the new smart rental index, which is more accurate than the old one. Here are a few important points:

• Rent Increase Rules: According to Decree 43 of 2013, the maximum a landlord can increase the rent in one year is 20%, not 15% as you thought.

• New Smart Index: The new index considers the building’s rating, which rates the quality of the facilities and the building itself from one to five stars. Even if you haven’t seen the building’s rating certificate, the new index includes this factor. You should check the new rental index to see what it says about your rent.

• Data and AI: The smart index uses both old and new rental contract data from the Ejari system and uses AI to make it more accurate than before.

• Next Steps: If the new index shows no increase, you should stick to that. If it shows a higher rent, both you and the landlord should agree on the new amount. If you and the landlord can’t agree, you may need to go to the rental dispute center to resolve the issue. Based on your situation, you might have a strong case.

Important Note: The information provided here is for guidance only and does not constitute legal advice. For more help, contact Info@erehomes.ae.