Can I rent out a shared ownership property in Dubai? This is a common question among co-owners thinking about joint property rentals. The good news? As per the Law. No. (6) of 2019, co-owners can rent their units, provided they abide by some rules and regulations.
While leasing shared ownership property can be a lucrative source of income, understanding the laws is crucial to avoid legal issues. But how does shared ownership rentals work? Read ahead to get complete details about renting shared ownership properties in Dubai.
- Overview of Shared Ownership in Dubai
- Shared Ownership Property Law in Dubai
- Shared Ownership Rules for Renting
- Best Practices for Leasing a Shared Ownership Property
- FAQs
Overview of Shared Ownership in Dubai
Let’s first understand what a shared ownership property is:
A shared or joint ownership property is any property owned by multiple owners. The owners can be friends, business partners, a married couple, or family members. This arrangement distributes the expenses between different owners, which reduces the financial burden and makes real estate investment more accessible.
Shared Ownership Property Law in Dubai
Law No. (6) of 2019 concerning ownership of jointly owned properties in Dubai outlines a set of rules that co-owners must follow. This law aims to bring transparency in joint ownership cases and protect the rights of all owners.
Let’s answer your question: Can I rent out a shared ownership property in Dubai? Article (16) of Law No. (6) of 2019 clearly states that co-owners can lease out their units, provided they follow certain conditions. But what are those conditions? Here is more on it.
Shared Ownership Rules for Renting
Before renting a shared ownership property, let’s understand the conditions for renting such properties:
1. Compliance With Legal Rules
As per Clause (a) of Article 16, both the owner and the tenant must comply with the community guidelines. This includes adhering to the rules pre-determined in the Statute of the Property, Master Community Declaration and the Building Management Regulation.
This means that the tenants should respect policies related to noise, waste management and behaviour towards other occupants.
2. Service Charges
Clause (b) of Article 16 protects the rights of other owners and building management. As per the law, the owner is liable to cover the tenant’s service and usage charges if they fail to do so. Unless the Unit lease agreement mentions otherwise, the owner will be responsible for service charges.
Best Practices for Leasing a Shared Ownership Property
Even after following the above rules, the owners must take extra measures before leasing their unit. Here are a few quick tips to avoid future inconvenience:
1. Discuss With the Co-Owners
In joint ownership schemes, all the co-owners should make decisions collectively. Before leasing your unit, you must discuss it with all the owners and seek their permission. While the law permits leasing individual units, it is equally important that all co-owners agree to the decision.
2. Draft a Lease Agreement
Start by drafting a clear lease agreement that stipulates the rights and responsibilities of both the tenant and the landlord. For instance, the agreement should state who will be responsible for service charges and utility bills.
3. Inform the Building Management
To maintain security and follow community guidelines, inform the building management about the lease.
4. Screen Tenants
Make sure to screen tenants and only choose reliable ones. This step can save you from future trouble. In case of rental disputes, the owner can file a complaint with the Rental Dispute Settlement Centre (RDSC).
FAQs
Yes, shared ownership is a good investment option for individuals who want to enter the real estate market but lack enough funds. Some benefits of shared ownership property include high returns, flexibility, and reduced financial burden.
An example of shared ownership is when two or more individuals buy property together. For instance, a married couple, family members, business partners, or friends. All the partners share the expense based on their percentage of ownership in the property.
Yes, you can lease a shared ownership property if all the co-owners agree to this decision. However, all the co-owners must decide on the distribution of rental income and expenses.
Now you know the answer to “Can I rent out a shared ownership property in Dubai?”. Also, make sure to inform the co-owners and the building management before renting out a shared ownership property.
Moreover, make sure to draft a tenancy contract outlining the roles and responsibilities of tenants. In this way, you can lease a shared ownership property and earn high returns.
Another flexible arrangement is rent-to-own properties in Dubai. Learn more about the laws and benefits of rent-to-own schemes.
