Dubai Rental Index and RERA Rent Increase Calculator Explained

On renewal, a Dubai landlord may raise the rent only if the current rent is below the market average for comparable units, and only by a set percentage tied to the size of that gap. The legal basis is Decree No. 43 of 2013, applied through the rental index published by the Dubai Land Department's Real Estate Regulatory Agency (RERA). Several 2026 guides, including haus & haus, confirm the bands remain unchanged this year.

The decree sets five steps. Commonly published thresholds are: rent up to 10% below the index average — no increase; 11–20% below — up to 5%; 21–30% below — up to 10%; 31–40% below — up to 15%; more than 40% below — up to 20%. Exact cut-off wording varies slightly between secondary sources, so always run the official calculator for your unit.

Worked example: a two-bedroom renting at AED 120,000 where the index average is AED 160,000 sits 25% below average, which falls in the 10% band. The maximum renewal rent would be AED 132,000 — not the full AED 160,000 market figure.

Since January 2025, the calculator draws on DLD's Smart Rental Index, which values rents at building level rather than broad community averages, factoring in attributes such as building quality and location. For landlords this means a newer, better-maintained tower may support a higher index figure than an older building in the same community. Some brokerage guides report further 2026 refinements; confirm details directly on the DLD platform.

A landlord wishing to change any term of the lease, including rent, must give the tenant at least 90 days' written notice before the contract expires, as noted by The Law Reporters and other guides. Without valid notice, the existing rent typically rolls over. If the parties disagree, the tenant may decline and either side can refer the matter to the Rental Dispute Settlement Centre.

What the index means for buyers: investors acquiring a tenanted property should check where the existing rent sits against the index before purchase. A unit let well below the average will take several renewals to catch up, because each increase is capped by the band; the in-place income is what you are really buying until the lease ends. Conversely, a unit let close to or above the index has little scope for increases on renewal. Factor this into your yield calculation rather than assuming the market rent applies from day one. When a tenancy ends and the property is re-let to a new tenant, the rent can be set by negotiation at market level, which is why the timing of lease expiry can matter as much as the headline price when comparing tenanted units. Ask the seller for the current Ejari, the tenancy start and expiry dates, and any notices already served.

Example one: a one-bedroom renting at AED 80,000 where the index average is AED 85,000. The rent is about 6% below average, inside the no-increase band, so the rent stays at AED 80,000 on renewal. Example two: a studio at AED 50,000 against an average of AED 60,000 — roughly 17% below, which falls in the 5% band, giving a maximum of AED 52,500.

Example three: a villa at AED 200,000 against an average of AED 340,000 — about 41% below, in the top band, permitting up to 20%, or AED 240,000. Even in this case the landlord cannot jump to the market average in a single renewal; the decree spreads catch-up across successive renewals. These examples use the commonly published thresholds and are illustrative; the official calculator is the authority for any specific unit.

At around four months before expiry, run the DLD calculator for your exact unit and save the result. Gather evidence of comparable rents in the same building in case the figure is challenged. At least 90 days before expiry, serve written notice of the proposed new rent in a traceable form. Keep a copy of the notice and proof of delivery.

If the tenant accepts, renew the contract and register the renewal on Ejari. If the tenant disputes it, discuss calmly with the index result in hand; if agreement is not reached, either party may apply to the Rental Dispute Settlement Centre. Throughout, remember that the index caps increases on renewal of an existing tenancy — for a new tenant, rent is negotiated freely at market level.

Serving notice late, which typically means the old rent rolls over for another year. Quoting a community-wide average when the Smart Rental Index works at building level. Asking for the full market rate when the band only permits a portion of the gap. And treating a 90-day notice of rent change as if it were an eviction notice — the two have different requirements under Dubai tenancy law, with eviction for owner use or sale requiring 12 months' notice by notary or registered mail.

Tenants benefit from the same transparency. Because the calculator is public, a tenant can check a proposed increase in minutes and respond with the official result. For landlords, presenting the calculator output alongside the notice tends to shorten discussions and reduces the chance of a dispute. Where a property has been improved significantly — a full refurbishment or new appliances — discuss this with the tenant openly, but remember that the cap on renewal still applies to the existing tenancy. Keeping rent changes predictable and within the rules is generally the best way to retain reliable tenants over many years, which supports both income stability and the condition of the property.

Check the index for your exact building and unit type three to four months before expiry, document comparables, and issue notice in a traceable form. Where your rent is already close to the index, a retained, reliable tenant may be worth more than a small permitted increase once vacancy and re-letting costs are counted. This is general guidance; confirm calculations with DLD/RERA.