Subleasing a property in Dubai means renting out a property you have already occupied as a tenant, to someone else. In this setting, you remain the tenant, and the individual you have rented the property to becomes the subtenant. Subleasing is a common practice in the Emirate of Dubai and other cities of the UAE. If you are keen to sublease your property, this article will be of great help to you as it explores the ins and outs of subleasing in Dubai. Read on to educate yourself about the types of subleasing arrangements and the associated regulations in Dubai.
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Types of Subleasing in Dubai
Subleasing can mostly happen in three(3) ways:
1. A real estate agency has occupied an entire building on lease and then, as the tenant, subleases the individual apartments to subtenants.
2. A tenant has leased a property directly from the landlord (the property owner) and then goes on to sublease it entirely to a subtenant.
3. A tenant resides in a rented property and has subleased a part of the property to a subtenant.
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Benefits of Subleasing in Dubai
Below we have explained how subleasing a property can benefit you in Dubai:
1. Additional Income
Subleasing can be a great arrangement for someone looking for a source of passive income. If you have leased an apartment, villa, or some other form of property, you can sublease it and collect rent from the subtenants. You can create partition rooms or bed spaces within your property and collect rent from individuals occupying each divided space. With Dubai being a popular destination for job seekers, such affordable housing options are in popular demand, and you should have no issues in finding takers for the accommodation you are providing.
2. Sharing of Rent
It is quite possible that the property you have currently leased is a bit more than what you require. In this scenario, you can lease out a part of your space to a subtenant. As an example, if you are currently leasing a 3BHK apartment, and feel that two rooms are enough for your family of four people, you can lease out the third room to a subtenant. You can then set an appropriate rent from the subtenant, and this will help you better manage the rent that you are currently paying.
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Is Subleasing Legal in Dubai?
Yes, subleasing is completely legal in Dubai, only if done with the landlord’s consent. Below we have discussed more on the landlord’s consent and the agreements required.
Landlord’s Consent
Subleasing in Dubai is governed by regulations laid down by the Dubai Land Department (DLD). The most important rule to remember is that subleasing can only be done with the landlord’s consent. This can be in the form of a No Objection Certificate (NOC). The landlord’s written permission is to ensure that he/she is aware of, and approves of the property’s use by an individual(s) other than the tenant(s). It also makes sure that the landlord consents to the modifications that may be done within the property as part of the subleasing. Once the landlord has given consent, the chances of disputes are significantly reduced.
Subleasing Agreement
Here’s what the subleasing agreement must outline:
1. Rent
The amount of rent that will be paid by the subtenant.
2. Term
The duration during which the subtenant will reside in the property.
3. Obligations of Tenant and Subtenant
The responsibilities related to maintenance and payments for basic utilities.
4. Miscellaneous Terms
Any other terms mutually agreed upon by both parties and can be related to rules, restrictions, and conduct.
5. Security Deposit
The amount to be paid by the subtenant as a refundable deposit to cover any possible damages on his/her part in the future (if any).
Rules for the Subtenant
Just like tenants, subtenants too must be notified about the rental increases through a 90-day prior notice. The applicable eviction rules are also the same for both tenants and subtenants.
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What if You Sublease Without the Landlord’s Consent?
Subleasing without the landlord’s permission is strictly prohibited. The landlord’s consent is a must which if not obtained means that you cannot go ahead with the sublease. If any tenant subleases without proper consent, the landlord has the right to evict the tenant. It is important to note that along with the tenant, the subtenant will also be evicted. Moreover, the ending date of the contract will be irrelevant in this matter. Hence, it is advisable to avoid subleasing without an NOC from the landlord. One must bear in mind that the subtenant, if evicted, also has the legal right to claim compensation from you.
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