RERA Rent Increase Rules in Dubai: Decree 43, the 90-Day Notice and the Smart Rental Index

Every renewal season the same argument plays out over a rent figure. Here is what the law actually allows, in the order a property manager needs to apply it.

The renewal letter goes out on a Tuesday. The tenant replies on Wednesday with a screenshot from the Dubai REST app showing that the proposed increase is not what the index allows, and a note that the letter arrived 82 days before expiry rather than 90. The owner, copied in, wants to know why the leasing team did not check first. Every property manager in Dubai has a version of this thread, and almost all of it is avoidable. Rent increases here are governed by a decree with fixed percentage slabs, a tenancy law with a hard notice deadline, and an official index that decides which slab applies. Get the three in the right order and the argument mostly disappears.

1. The slabs come from Decree 43 of 2013, and they have not moved

Decree No. 43 of 2013, issued on 18 December 2013, is still the instrument that caps rent increases at renewal in Dubai. Article 1 sets five slabs, and the trigger for each is how far the current rent sits below the average market rent for a comparable unit. If the rent is up to 10% below the average, no increase is permitted. If it is 11% to 20% below, the maximum increase is 5%. At 21% to 30% below, the cap is 10%; at 31% to 40% below, 15%; and only where the rent is more than 40% below the average may the landlord ask for the full 20%.

Two details are routinely misread. First, the percentages are ceilings, not entitlements: nothing obliges a tenant to accept an increase the index does not support. Second, Article 2 applies the decree across the whole emirate, expressly including special development areas, free zones and the Dubai International Financial Centre. Free-zone units are not outside the framework.

Article 3 then names who decides the "average market rent": the Rent Index approved by the Real Estate Regulatory Agency. That index is what changed in 2025.

2. What the Smart Rental Index changed in January 2025

On 2 January 2025 the Dubai Land Department launched the Smart Rental Index, replacing the older area-based calculator. The material difference is that the index now values buildings, not just areas. According to DLD's announcement, each building is classified using a set of criteria covering its technical and structural characteristics, the quality of finishes and maintenance, its strategic location and spatial value, and the level of services and facilities such as maintenance, cleanliness and parking. Rental valuations are produced with an AI-based model that combines that classification with registered contract data. Majid Al Marri, CEO of DLD's Real Estate Registration Sector, said the index "provides fair and accurate rental valuations".

The index covers all residential areas in Dubai, including special development zones and free zones, and DLD has said it plans to extend the model to commercial and industrial property in later phases. DLD also noted the scale of the data behind it: more than 900,000 rental contracts were registered in 2024, an 8% increase on 2023.

The practical consequence is that two identical flats in the same street can now sit in different bands because one building is better maintained, serviced or located. A rent that was "at index" under the old area average may no longer be, in either direction.

3. The 90-day notice is a hard deadline, not a courtesy

Law No. 26 of 2007, as amended by Law No. 33 of 2008, governs the landlord–tenant relationship in Dubai. Article 14 requires either party who wants to amend the terms of the tenancy at renewal, including the rent, to notify the other no less than 90 days before the contract expires, unless the parties have agreed otherwise. Article 13 allows the parties to renegotiate rent before expiry and, if they cannot agree, gives the Rental Dispute Centre the power to determine a fair rent by reference to comparable market rates.

DLD has been explicit about how these rules interact with the index. Its February 2025 guidance states that an increase applies only where the Smart Rental Index confirms eligibility, and that a landlord who has not served the 90-day notice cannot apply the increase for that renewal even if the index would allow it. The index gives you the ceiling; the notice gives you the right to ask for it.

4. How to run the check, step by step

The rent increase calculator sits inside the DLD Rental Index service, available on the DLD website, in the Dubai REST app and through DubaiNow, with an immediate result. The inputs are the contract expiry date, property type, area, number of rooms and current annual rent. A repeatable renewal routine looks like this:

• Pull the index result well before the 90-day line. Run the calculator for every unit expiring in the next four months and record the average and the permitted percentage against the unit, with the date the check was run.
• Apply the Decree 43 slab to the current registered rent. Use the rent on the Ejari-registered contract, not a verbal figure or a figure from a side letter.
• Draft the renewal offer at or below the cap. Rounding up "because the market has moved" is the most common cause of a disputed renewal.
• Serve the notice in writing no later than 90 days before expiry, and keep evidence of delivery. A signed acknowledgement or registered post is safest.
• Register the renewal in Ejari. Article 4 of Law 26 of 2007 makes registration of tenancy contracts mandatory, and the DLD guidance notes that unregistered contracts cannot be relied on before the judicial authorities.

5. A worked example

Take a two-bedroom unit registered at AED 100,000 a year. The calculator returns an average of AED 130,000 for comparable units in that building's classification. The current rent is roughly 23% below average, which lands in the 21% to 30% slab, so the maximum increase is 10%, or AED 10,000: the offer can be up to AED 110,000, not AED 130,000. Had the index returned AED 108,000, the rent would be about 7% below average and no increase would be permitted, whatever nearby listings are asking. These figures are illustrative; the only numbers that matter are the ones the index returns on the day you run it.

6. Where it gets complicated

The index is a floor for disputes as well as a ceiling for increases. In a case published by DLD, the Rental Dispute Centre ordered a landlord to reduce the rent on a commercial unit by AED 32,000 after the tenant produced the index average and a properly served 90-day notice of his own. Article 14 works in both directions, and a tenant paying above the index can use it to push rent down at renewal.

Building classification can also move. A building that slips on maintenance or services may be reclassified, and with it the average that sets your slab. Re-run the check when the notice is served, not months earlier, and keep both results.

Because Article 14 allows the parties to agree otherwise, some contracts carry their own notice provisions; read the registered contract before assuming the statutory period, and where it is silent, assume 90 days. A rent increase is also separate from ending the tenancy: under Article 25 of the amended law, eviction on expiry for the landlord's own use, sale, demolition or major renovation requires twelve months' notice through a notary public or registered post. A 90-day rent notice does not double as an eviction notice.

Finally, this framework is Dubai's. Abu Dhabi, Sharjah and the other emirates run their own tenancy regimes, and a portfolio spanning emirates needs a renewal process for each.

What this means in practice

The renewal argument in the opening paragraph is usually a process failure, not a legal one. The law is short and the index is free and instant; what breaks is that nobody checked the index before the offer went out, the notice was served on day 82, or the "current rent" in the letter was not the rent on the Ejari contract. A team that checks the index at 120 days, drafts inside the slab, serves notice before day 90 with proof, and registers the result has very little left to argue about.

In PropertyPad, the lease lifecycle module records the RERA index result and permitted slab against each unit, flags contracts approaching the 90-day line on the compliance calendar, generates the renewal offer at or below the cap, and logs notice delivery through WhatsApp or email so the evidence sits with the tenancy record. See how that fits with Ejari drafting and PDC handling on the features page, or read the wider context in our UAE property market outlook for 2026.

Sources:
1. Decree No. 43 of 2013 Determining Rent Increases for Real Property in the Emirate of Dubai (Dubai Land Department) — date of issue, the five increase slabs in Article 1, scope in Article 2 including free zones and DIFC, and the RERA Rent Index as the benchmark in Article 3.
2. Dubai Tenancy Guide, Law No. 26 of 2007 as amended by Law No. 33 of 2008 (Dubai Land Department) — Article 4 registration, Article 13 rent review, Article 14 90-day notice, Article 20 security deposit and Article 25 twelve-month eviction notice.
3. Dubai Land Department launches Smart Rental Index 2025 (DLD, 2 January 2025) — building classification criteria, AI-based valuation, residential and free-zone coverage, planned extension to commercial and industrial property, 900,000+ contracts registered in 2024 (+8%), and the quoted statement by Majid Al Marri.
4. Dubai Land Department launches Smart Rental Index 2025 (Government of Dubai Media Office, 2 January 2025) — corroborating classification criteria, scope and Dubai REST interactive contracts.
5. The Smart Rent Index mitigates inflation in Dubai and enhances market transparency (DLD, 16 February 2025) — increases apply only where the index confirms eligibility, and cannot be applied without the 90-day notice.
6. Rental Index e-service (Dubai Land Department) — calculator inputs (expiry date, property type, area, rooms, current annual rent), access via DLD website, Dubai REST and DubaiNow, immediate result.
7. RDC obligated a real estate owner to reduce the rent of his commercial property (Dubai Land Department) — AED 32,000 reduction ordered on the basis of the index and a 90-day notice served by the tenant.
8. Leasing a property in the UAE (UAE Government Portal, updated 20 January 2026) — Ejari registration through DLD and the Rental Dispute Centre's role.

This article is general information for property operators, not legal advice. Tenancy rules, index methodology and fees change; verify the current position with the Dubai Land Department, RERA or a qualified adviser before acting on a specific tenancy. The worked example uses illustrative figures only.