Abu Dhabi and Dubai tenants protected from eviction amid the coronavirus epidemic

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Tenants struggling to pay their rent as a result of the pandemic should be protected “by the moral standards of landlords in Dubai”, according to the Dubai Land Department, as residents in Abu Dhabi are exempted from eviction and developers unveil initiatives to ease costs for those renting or owning property.

No case has been filed as a direct result of the virus, the DLD told The National on Tuesday, and the government body said it will work to solve issues as they arise

When the threat of the virus subsides, we are certain that any additional measure that may be introduced would cater to both tenants and landlords.

Dubai Land Department

“This is an exceptional situation that we are witnessing … We are confident of the moral standards of landlords in Dubai who are working closely with the authorities under the guidance of the wise leadership to make sure residents feel safe in their homes and that their mental and physical well-being are being prioritised,” the DLD said.

The government “is holding continuous meetings in that regard”, and few DLD-endorsed landlords have “already taken the initiative” by deferring tenant payments or granting them temporary rental reductions, the DLD added.

On Tuesday, Sheikh Mohamed bin Zayed, Crown Prince of Abu Dhabi and Deputy Supreme Commander of the UAE Armed Forces, ordered the Abu Dhabi Judicial Department to halt all rental property eviction cases currently in process.

“The move is in line with the UAE government’s keenness to support members of society and reduce their burdens during the current situation,” said the the government statement carried by state-run news agency Wam.

While Sharjah Asset Management, the investment arm of the Sharjah Government, said on Sunday it would waive commercial rents for all tenants of Haraj and Jubil markets for three months, no measures have been announced for residential property.

The situation “changes by the hour so it’s best to keep a close eye on any developments and updates” said Wael El Tounsy, counsel and head of real-estate, dispute resolution department, at law firm Baker McKenzie Habib Al Mulla.

The UAE government is rolling out a series of measures to alleviate the financial burden on businesses and consumers as a result of the slowdown in activity caused by the Covid-19 pandemic.

The virus has now infected more than 390,000 people worldwide and killed 17,000 and more, according to Johns Hopkins University, which is tracking global data on the outbreak. About 103,000 people have also recovered.

Some companies in the UAE have reduced the number of days their staff work or cut salaries to help counter the effects of a halt in operations during the stay-at-home directives form the government. This can in turn affect residents’ ability to meet rental payments.

While landlords have a robust list of rights to protect them if a tenant cannot pay their rent, under rental laws facilitated by the Real Estate Regulatory Agency, “their priorities right now are to the well-being and safeguarding of tenants”, said the DLD.

“The government is consistently seeking measures to make everyone secure and happy, and matters of eviction are not ones we would prefer to delve into at this time,” it said. “When the threat of the virus subsides, we are certain that any additional measure that may be introduced would cater to both tenants and landlords.”

Real estate agents confirmed that landlords are already being flexible with tenants struggling financially.

Nick Grassick, managing director of PH Real Estate in Dubai said its property management team is “experiencing the polar opposite of tenants being concerned”, as it helps renters secure a payment hiatus for the short term, and “much more lenient payment terms and conditions for new leases”.

The “overwhelming sentiment” from landlords managed by the company is “one of empathy and support to tenants plight” he added. “It’s genuinely encouraging to see commercial decisions and interest being considered secondary to humanitarian concern.”

Meanwhile, developers in the UAE are offering more favourable terms for their residential clients. Last week, Abu Dhabi developer Aldar introduced a monthly payment plan option for the 5,000 tenants in its communities and said it would waive all transaction fees and penalties for 2020.

The property developer said it is also co-ordinating closely with leading Abu Dhabi financial institutions to offer attractive and subsidised financing solutions to existing customers and new homeowners to ease upcoming and final payments. It will also waive all administrative fees associated with transactions with Aldar, including service charges, transfer fees and late payment fees applicable during 2020.

In Dubai, developer Nakheel said residential and commercial customers will receive a 10 per cent discount on cooling charges for three months, as per government directives.

“Other initiatives are under discussion,” a Nakheel spokeswoman told The National.

For owners struggling to pay mortgages due to unpaid rent, banks are being more flexible on mortgage payments, said Dhiren Gupta of 4C Mortgage Consultancy.

“For mortgages, banks are offering a one-month grace period which can further be extended based on your economic conditions and your past record with the bank,” he added.

Banks are also negotiating reductions in interest rates, according to Brendan Kennelly, senior mortgage consultant at mortgagefinder.ae, depending on the rate the customer is currently on.

“They are also extending the length of mortgage terms to reduce the monthly repayments. The banks appear to be more open to restructuring customers’ mortgages at this time,” Mr Kennelly added.

Updated: March 24, 2020 08:41 PM



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