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The amount paid to the landlord as security deposit is normally 5 per cent of the rental amount, but if the property is fully furnished, the owner could ask for 10 per cent or more, although the final amount is decided by mutual agreement between the tenant and landlord. The deposit is generally a form of guarantee the tenant will satisfy the conditions stated in the lease, and is returned at the end of the tenancy.
To recover the amount, the property must be in good condition when turned over to the landlord. Damages beyond normal wear and tear can be charged against the deposit.
However, most people have different views on what can be classified as wear and tear. This often leads to disputes when trying to get back the deposit.
Some tenants would rather forgo the amount to avoid dealing with contentious landlords. Here are a few things to consider.
Read the contract
Read the fine print in your contract before you move in. Discuss with the landlord any clause that seems unreasonable and ask for it to be amended, says Mario Volpi, Managing Director of Ocean View Real Estate.
Make a checklist
Document everything with appropriate photos when you move in. Jerry Parks, Partner at Taylor Wessing, says, “To minimise the possibility of a dispute, and to serve as good evidence to support your position if there is a dispute, it is important for the condition of the property and contents to be accurately recorded at the time of possession.”
Know the law
UAE law states that a landlord can obtain a deposit from a tenant to guarantee the maintenance of the rental property, provided it is refunded at the expiry of the tenancy. “The law also provides that the tenant must return the property to the landlord in the same condition as when it was received, except for fair wear and tear or damage due to reasons beyond the tenant’s control,” says Parks.
“If the parties can’t agree on whether the damage falls into [either of] these categories, then the matter must be referred to the Rent Disputes Settlement Centre.”
By law, tenants cannot make alterations to a property without a landlord’s agreement. Even if they agree, the tenant could be charged for rectification works on the expiry of the lease.
Treat the property as if you own it, says Shalini Arora, Leasing and Property Management Director at Driven Properties.
The tenant should report maintenance issues to the landlord and if it is a minor issue, get it fixed immediately. Prompt action can prevent major damages and secure your deposit.
Find a company to assist in cleaning and maintenance, advises Wasim Tariq, Director of Aaj Property. “Repainting the property, fixing damaged areas and returning the property in the same condition before moving out will help you get zero deduction from your deposit amount.” If the task is left to the owner, in many cases the tenant will end up paying more than the deposit amount.
Give yourself time
Moving out of the property must be planned ahead to ensure there’s time to look into its condition, says Arora. Giving the landlord sufficient notice is therefore good practice, ensuring there is enough time to check the property.
Areas of dispute
Disputes mainly arise from the condition of the property. Volpi says, “Most tenancy contracts allow for wear and tear but this is open to interpretation too, especially if there was no condition report drawn up at the start of the tenancy. The other areas of dispute are outstanding utility and chiller charges.” There are sometimes charges or invoices that pop up even after final bills have been paid. These can cause issues as landlords or new tenants would not be able to apply for utility connection due to the outstanding amounts.
A landlord can deduct from the deposit if the property has damaged items, painted walls other than the original colour, unpaid utility bills and poorly cleaned premises, says Arora.
If the deposit does not cover the cost of the damages, Volpi says the landlord can charge the tenant for the additional costs. He says if a landlord does not return the deposit to the tenant, the matter should be reported to the Dubai Municipality.
Source: Hina Navin, Special to PW