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New leasing law in Bahrain comes in favor of tenants

Bahrain - January 27, 2015
Agreement to provide legal help for landlords in Bahrain

The world pioneering real estate consultancy, Cluttons, has mentioned that the new procedures ought to be applied in Bahrain organizing the rents contracts will contribute in increasing the market maturity.

The company mentioned that the new decrees will bolster the market attraction as the new decrees will develop the regulatory framework of the market making it more effective and up to date, however, the company said that the new decrees could contribute in limiting the residential and commercial properties growth.

The new decree states on instating a maximum limit on rental increase not to exceed 5% for residential units and 7% for commercial units, it states also that first rental increase should take place after two years.

Faysal Al Werdany, head of research and business development in Cluttons, mentioned to Akhbar Al Khaleeg newspaper that the new law could negatively affect the owners’ revenues especially if the market performance exceeded the stated limits.

Debora Sellers, head of residential properties department at Cluttons Bahrain, said that the new law comes in favor of tenants, she said also that the new law is a positive step towards organizing the real estate market in the light of the current market revival and stability.

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