• Bounced Cheques and How to Mitigate your Risk with Holiday Home

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  •  Firas Al Msaddi  Tuesday, 18 September, 2018  tips

    Bounced Cheques and How to Mitigate your Risk with Holiday Home

    With the holiday homes model landlords are able to eliminate the danger of having bounced
    cheques as compared to the risk with long term tenants. In 2017, legal experts in the UAE called
    the decision by Dubai Courts to issue fines instead of jail sentences for a range of minor
    offences including bounced cheques and failing to pay rent a “step in the right direction” to
    ensure those in lingering debt can resolve their issues.
    When a landlord rents their property in Dubai for multiple cheques, there is a chance that they
    may face a bounced cheque; especially if the economy experiences a downturn where jobs are
    lost or salaries are cut. As a landlord, you would be required to attain a bank report and then
    proceed with a police case in order to chase the tenant who may not be financially capable of
    recompensing the missed payment or may have left the country. As a landlord, you must attain
    a court order in order to access your property as it is illegal to enter a tenanted property
    without consent of the tenant.
    With the Holiday Homes model, you entirely eliminate this risk as guests pay upon checking
    into your property, and must do with an additional specified deposit for damages. A
    fundamental gain that provide landlords with peace of mind is the fact that their property will
    be maintained to the highest standards at all times. Prior to every check out and check in, the
    property is inspected for any damages, both to personal items and to the internal structure
    itself. As a landlord with a long term tenant, you aren’t able to ensure your property is being
    looked after to the standards you require.
    Furthermore, occupancy rates are extremely competitive when compared to long term
    tenancy. While rates are already higher per annum, we have experienced extremely high
    occupancy rates in all of our holiday homes at FAM Living. Our operations began in December
    2017 and while a fall in occupancy was expected throughout the low season (summer and
    Ramadan), we were amazed at the high occupancy rates we witnessed during the low season
    2018. At FAM Living our model considers both low season occupancy and seasonal rates in
    order to provide the landlord with the minimum annual rent they should anticipate. In
    conclusion, as compared to long term tenancy our holiday homes rentals in top localities in
    Dubai make the landlord up to and sometimes more than 25% on their annual income.

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