Politics
Bur Dubai Housing Rent Cap Policy Revises Annual Adjustments for Tenants
The ordinance limits rent increases to 5 percent annually on existing leases registered in Bur Dubai, starting with renewals from 1 August 2026.
How we reported this
The Bur Dubai Municipal Council approved the updated Housing Affordability Ordinance on 2 July 2026, which sets new parameters for annual rent reviews in residential areas including Al Fahidi, Meena Bazaar and surrounding districts. This change directly applies to approximately 85,000 rental contracts registered with the Dubai Land Department in the Bur Dubai jurisdiction.
Local government officials introduced the revisions following the release of the 2026 municipal budget papers, which allocated 120 million dirhams to housing support programmes. The policy responds to sustained demand for rental properties as the area continues to attract workers in tourism and trade sectors.
Effects on Household Budgets
For a typical one-bedroom apartment currently leased at 45,000 dirhams annually, the ordinance restricts any increase to no more than 2,250 dirhams in the coming year. Families renting larger units in buildings managed by the Dubai Municipality will calculate their new rates using the same percentage ceiling applied to the previous contract value.
Policy analysts note that the legislation states exemptions for new builds completed after January 2025, allowing market rates for those properties only. Existing tenants must provide proof of continuous occupancy to qualify for the capped adjustment when renewing leases through the Ejari system.
The Dubai Land Department recorded 42,000 lease renewals in Bur Dubai during the first half of 2026, according to its quarterly statistical release. Under the revised rules, these renewals will now incorporate the 5 percent maximum rather than the previous 10 percent guideline.
Implementation begins with notifications sent to landlords via the municipality's online portal by 15 July. Tenants who receive proposed increases above the limit can file disputes at the Rent Disputes Settlement Centre located on Sheikh Khalifa bin Zayed Street.
Further reviews of the ordinance are scheduled for the municipal council meeting in October 2026, where additional data from the first three months of application will be examined.