Steep rent hikes anger Sharjah residents

Steep rent hikes anger Sharjah residents Dhanusha Gokulan and Amira Agarib / 12 June 2013 LAWS IGNORED AS LANDLORDS, AGENTS ALLEGEDLY INCREASE RATES BY 15-20% Sharjah was once the emirate people flocked to due to low rents, but now residents are being asked to cough up more money. — KT photo by M. Sajjad I grew up here. Got married to a man whose family settled here in the late 60’s and now I know that my children will also grow up here. I know the little alley ways in Abu Shagarah and Jamal Adbul Naser Street better than the main streets of Lahore,” said * Syeda M . Pakistani national Syeda M has lived in Rolla, Sharjah all her life and if there is one place that she can call home, it would be Sharjah. Syeda’s family, who originally hail from Lahore, have earned their livelihood for all these years by selling cotton textiles at the Al Ghurair Market, Rolla. Her family took a massive beating during the 2008-09 financial crisis. “It took us a long time to recover from it and our business is still recovering. I had just gotten married (at that time) and I think our biggest hurdle was payment of rent. We just couldn’t afford a rent of Dh27,000. We are a family of six members, and we used to stay in a cramped two bedroom apartment,” she said. Back in 2008, the family split and got two smaller single bedroom apartments for Dh17,000 per year. The crash subsequently resulted in a drop of rents in all residential areas across the emirate. “Our building watchmen/manager’s timely recommendation and intervention (regarding rents) is what saved us then. Since we’ve known him for several years, all that was required was a token amount of Dh500. We found a new place and slowly the rents too started to go down,” said the mother of two young boys. However, Syeda now fears that history could repeat itself. “Our owners announced a Dh2,000 hike in our rent. Currently, the rent is Dh19,000 for a single bedroom apartment. We will have to cough up Dh21,000 in a single cheque according to the owner. At the recommendation of our manager, we managed to bring the hike amount down to Dh1,000,” said Syeda. Watch your watchmen Demanding more, despite fires Since 2007, Sharjah has witnessed several fires in both residential buildings and commercial properties. The fires have taken a high toll on both human life and personal property. Despite the high number of casualties and poor maintenance of buildings, buildings owners are still hiking rents. Al Aneeqa residential tower in the Al Nahda area has suffered close to three fires in less than two years. However, even though their fire alarms weren’t repaired, the residents received their hike increase notice on time. But Sharjah Civil Defence authorities have upped the ante and said they will take strict action against flouters of safety rules. Syrian national Abdul Karim and resident of Al Aneeqa Tower said: “The building is very poorly maintained. During the last fire…there was no warning and now they say rents are going to be hiked.” Director General of Sharjah Civil Defence Department Brigadier Abdullah Al Suwaidi told Khaleej Times that following repeated violations in a number of residential buildings across Sharjah, an official committee, including officials from Sharjah Civil Defence and Sharjah Municipality was set up. “The committee has formed a mechanism to combat violations pertaining to the maintenance of buildings and the installation of fire fighting equipment. The department officials have also been visiting buildings to ensure that safety measures are maintained,” he said. He added that any company caught tampering with or not abiding by Civil Defence specifications, will be suspended or shut down. – news@khaleejtimes.com   The case presented by Syeda is only one among the several families that are being affected by the sudden hike in rents across Sharjah. Real Estate specialists Cluttons reported that landlords in the emirate are benefiting from the rising residential rents in Dubai and an influx of people who are being priced out of the market accordingly. While several residents can afford the above 15 per cent hike, some families are moving out to neighbouring emirates including Ajman and Ras Al Khaimah. Most families Khaleej Times spoke to are concerned that rents will further increase next year. “We do not mind the current hike, but if it goes up further, yes it is going to get tough for us,” added Indian national Suni Verma .  Adding fuel to the fire, building watchmen and managers have been making a quick buck taking advantage of the predicament faced by these families. * Reema Sunil said she was propositioned by her watchman. “Last month (he) knocked on our door. It’s simple he said. ‘You can pay me Dh500 to Dh1,000 for this year and keep paying the same rent amount as before,” she said. Sunil stated that their family was offered a choice. “Either we pay the extra Dh1,500 as rent or we give a token amount to my watchman.” The Sunil’s went in for the second option. “Who is going to go lodge a complaint? It’s too much work,” she added. Demanding landlords The recent launch of Arenco Golden Sands Tower in the Al Nahda area of Sharjah, illustrates the strength of the rental market with prices from Dh41,000 for one-bedroom units — prices that have not been seen in Sharjah for several years. Additionally, landlords are tightening up on their terms and are only prepared to accept a one cheque annual payment with a further 20 per cent of the annual rent required as a security deposit. Associate director at Cluttons in Sharjah Shane Breen said: “Sharjah is viewed as the most suitable alternative to those finding themselves out-priced by rising rents in Dubai, and demand is outstripping supply for the first time since the global financial crisis. We also note landlords offering tight payment terms, in a move away from flexibility. Sharjah’s industrial and logistics sector accounts for approximately one fifth of the emirate’s GDP.” Other rental rates in the Corniche area average around Dh30,000 to Dh32,000 per year for a medium quality one bedroom flat. The report also stated that landlords are becoming increasingly flexible with their office leasing agreements, thereby boosting demand. Brokers at Sharjah’s best known real estate managers Asteco too, have confirmed of the hike. For many residents, the next best option is to move to Ajman. “I work in Jebel Ali and I currently live in Al Nahda. But the rents have hiked up considerably in Al Nahda. I pay Dh25,000 for a two-bedroom flat at the moment. It might go up to Dh30,000. If I want to continue staying with my family, I will have to shift to Ajman. It’s just too expensive. I am already paying Dh3,000 for my transport alone and the newly installed toll gates are burning a big hole in my pocket” said Renjith , a Indian national. However, reports from analysts have suggested that government legislation is in place to help protect tenants from spiralling prices. Sharjah Municipality offers tenants a protection period of three years from the start of a new lease with rates then moving to “market rate” on renewal of the fourth year. Experts at Cluttons have predicted that this will cause an increase in disputes between tenants and landlords via the rental committee hearings within the Municipality. What Sharjah Municipality says Sharjah Municipality confirmed that owners of buildings should not hike rents before the completion of three years based on the tenancy law that stipulates the relation between tenants and landlords. Officials at Sharjah Municipality, following a rising number of complaints on rent hike, stressed that rent laws in Sharjah have not been changed. Head of the Rental Disputes Section Salem Al Qaabi denied any change in the laws and stated that landlords are not allowed to hike rents at will. He clarified that building owners are not supposed to increase rents during the protection period of three years. “Even if the owner has stated it in the contract, until the three-year period is over, the tenant is not required to pay a higher amount,” said Al Qaabi. He said articles in the contract would not be implemented if it does not match with the law and it would be considered as void with accordance to Federal Law Number 2, 2007. Al Qaabi asked people to read the law which is stated on the Sharjah Municipality website and their offices. “Now if the tenant wants to leave the flat before the expiry of the contract, the landlord is entitled to 30 per cent of total rent as compensation,” added Al Qaabi. This year, the Rent Dispute department has succeeded in ending 2,641 disputes. However, the person or party who disagrees with the judgement has the right to appeal within 15 days from that date of judgement and to abide by laws stipulated by the appeal committee which will issue the final judgment. Al Qaabi also insisted that tenants must attest the leasing contract to preserve their rights. Sharjah Municipality coordinates with Sharjah Courts and Public Prosecution to investigate on address of dispute parties, especially UAE nationals and informing them on the judgment to preserve their rights. He urged the public to call 600566002 and 993 for information, complaints and inquiries. dhanusha@khaleejtimes.com (Full names withheld on request) Taylor Scott International