Tuesday, March 31, 2009

RERA's updated version of rental index still uncertain

It is still uncertain, if Dubai's RERA would update its rental index in April this year, as was previously announced, or would just expand its current version of rental index, by including the areas left our in the original survey, reports AME Info.

During a press conference in Dubai, during the end of February this year, RERA had indicated that its rental price index would be updated and re-released early this April.

The announcement was made following the disputes that occurred after the release of the first version of Dubai rental index, which was compiled when the rents were at their peak in 2008, much before the slowdown hit the emirate. This version of the index was released in January this year, following which, there were arguments about the rates in the index not being in accordance with the post-slump market.

It has now been learnt that instead of completely updating the current index figures in April, RERA may just fill in the averages for the areas and bands, not covered in the original chart.

An official at RERA is told to have mentioned that there will be no changes to the existing figures, and RERA is only updating the areas that were not mentioned in the last index, and a new survey would be conducted this summer.

This implies that rental contracts would be measured against average figures that bear little resemblance to prevailing market rates.

The Managing Director of Better Homes, Ryan Mahoney, who spoke to AME Info, agreed about the huge drop in rentals in Dubai, and urged RERA to regularly update the index, and maintain it inline with the fast-changing market, else, people may stop referring the index.

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