From impending taxes to maintenance woes, District Real Estate’s head of sales and leasing Alan Kaye answers your property queries
Q. I have heard that next year the UAE will be introducing value added tax (VAT). Is this correct and do you have any information as to the rate and the items that it will be applied to?
A. You have unfortunately heard correctly. It has been announced that it will be applied from 1st January 2018 throughout the UAE and probably all of the GCC.
The initial rate will be five percent but it has not yet been finalised as to what will be included or excluded or will carry a zero rate.
In the UK, for example, rent and many food items are excluded but leasing fees do carry VAT. Utility charges are excluded but if you need a repair to your meter for which there is a callout charge then this charge will have VAT added.
Both the rate and application vary from country to country so we will have to wait for future announcements.
I should also mention that even 44 years after VAT was introduced in the UK, appeals are still being made for VAT to be included or excluded on various items so we must hope that the UAE will introduce an appeals procedure at the same time.
Q. My lease contract expires in September 2017 but I think that my work contract will now not be renewed and that ends at the end of May. Can I get the difference in the rent refunded to me if I need to
A. It all depends on your lease contract. There will normally be a section for if you need to break your lease and it varies between every landlord.
It could specify a time frame, the normal being two months’ notice and two months’ rent.
Or it may say “at the landlord’s discretion”, which means the landlord will decide at the time. It may also not say anything. Both of these scenarios mean that you will have to negotiate at the time.
Unfortunately some landlords do not refund rent and this is why it is important to read and understand the lease contract before you sign.
Q. We have had maintenance issues in our apartment for the past two years. The contracted maintenance company has attempted numerous times to fix the problem but without success. My lease is due for renewal and I want to use this issue to ensure my rent is not increased. How do I go about this?
A. The first thing that you need to do is contact the landlord in writing and advise them of the problem and also the rent that you would wish to pay for the next year.
As per the law this needs to be done a minimum 60 days before the lease ends.
You may also wish to bring in an independent contractor to check out the problem and to give you an estimate to fix the problem once and for all.
I would suggest that you deduct the amount of the estimate from your current rent as a starting point and negotiate from there.
Also check out the rents being asked on current empty properties similar to yours so you are aware of the current market.
Q. We live on Reem Island and have a really good sea view. The real estate agent promised us that there were no plans to build in front of us but now a tower is being built which will effectively block our view. What can we do?
A. There is not a lot that you can do except either to move or negotiate a rent reduction when your lease is due for renewal.
Make sure that you start this process a minimum 60 days before the end of the lease.
I am sure that at the time you moved in there possibly were no plans to build in front of your building. It is unfortunately extremely difficult in Abu Dhabi to find out information on future planning.
Q. We have stringed lights on our apartment balcony but have recently been advised to remove them by the property management. Some of our neighbours have been told likewise but for different reasons such as safety or that other people have complained. Where do we stand?
A. You will need to refer either to your lease agreement or the community rules. These may be part of the lease or separate.
I think that you will find that there will be a clause to the effect that “the outside has to be uniform in appearance” and that if you are to place any item on your balcony that can be seen from the outside then permission needs to be granted by the property management. Clearly you and your neighbours have not done this hence the request to remove the lights.
If you have any property related queries, send them in to firstname.lastname@example.org