Bahrain rent law: increases, deposits and registration
Updated
Renting a home in Bahrain is governed by the Real Estate Lease Law (Law 27/2014). It sets how leases are registered, how often and by how much the rent may rise, and how much a landlord may ask up front.
A lease must be in writing and registered within one month; the landlord pays the BHD 5 fee. A home's rent may rise only after 2 years, by 5% at a time and at most five times — unless you agreed otherwise in writing. Deposit at most 1 month's rent, advance rent at most 3 months. A tenant pays a municipal fee of 10% of the rent with the electricity and water bill. Renting a home carries no VAT.
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Registration
- Within a month: A lease must be in writing and registered within one month of signing; courts do not hear claims on unregistered leases.
- The fee: Registering a residential lease: a fixed fee of BHD 5 (BHD 10 for other uses), set by Ministerial Order 9/2015 within the BHD 1–5 range of Law 27/2014; the landlord pays it.
- If the landlord does not register: Law 27/2014 Art. 7: the registration fee is set by Ministerial Order between BHD 1 and BHD 5 for a home and is borne by the lessor; if the lessor refuses, the tenant registers and deducts the fee from the rent.
Rent increases
A landlord may raise a home's rent only after 2 years from the start or the last rise, by 5% at a time and at most five times during the lease — unless you agreed otherwise in writing. Read the lease for a clause on rent increases.
Example: a rent of BHD 400 a month
If the lease says nothing else in writing and the landlord uses every rise allowed (our assumption):
| When | Monthly rent at most |
|---|---|
| Start | BHD 400.000 |
| After 2 years (1st rise) | BHD 420.000 |
| After 4 years (2nd rise) | BHD 441.000 |
| After 6 years (3rd rise) | BHD 463.050 |
| After 8 years (4th rise) | BHD 486.203 |
| After 10 years (5th rise) | BHD 510.513 |
Deposit and advance rent
- Deposit: Security deposit at most one month's rent, returned at the end less what you owe; advance rent at most three months for a home. On BHD 400 a month: at most BHD 400.000.
- Advance rent: Advance rent for a home: at most three months. On BHD 400 a month: at most BHD 1,200.000.
- Electricity and water deposit: Electricity and water deposit when the account holder does not own the home (tenants): electricity BHD 100 (single-phase meter), BHD 300 (three-phase), BHD 1,000 (C.T. meter); water BHD 100 (15 mm connection), BHD 500 (25 mm), BHD 1,000 (50 mm). With both accounts only the higher deposit is paid; it is refunded less any arrears, and the landlord's personal guarantee is accepted instead of cash.
Disputes
Rent disputes go to the High Civil Court; its judgement is final for claims up to BHD 1,000.
The municipal fee
Municipal fee on a rented home: 10% of the rental value, and never less than the fee an owner-occupier pays for the same home (Ministerial Decision 22/2005, Table B); it is billed with the electricity and water account. The municipal fee runs through a municipal-fees account tied to the electricity and water account and is adjusted to the rental value of the registered lease. On a rent of BHD 400 a month that is BHD 40.000 a month. Bahraini tenant families who qualify for the reduction under Ministerial Decision 3/1999 pay the owner-occupier rates instead: BHD 2 to BHD 14 a month by area (Table C); Ministry of Housing units BHD 2. An owner living in the home pays the owner-occupier rate, BHD 2–14 a month.
VAT
Renting a home is VAT-exempt; hotels and serviced accommodation carry 10% (a lease of a year or more never counts as serviced accommodation).
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Sources: the Real Estate Lease Law (Law 27/2014, as amended by Law 13/2020), published by the Survey and Land Registration Bureau and the Legislation and Legal Opinion Commission; Ministerial Order 9/2015 (lease registration fee); Ministerial Decision 22/2005 (municipal fees); Minister's Decision 2/2015 as amended (electricity and water deposits). Not legal advice.
What carries VAT in Bahrain and what is exempt: VAT in Bahrain — with a calculator to add or remove 10% VAT.
Questions people ask
How much can a landlord raise the rent in Bahrain?
In Bahrain, for a home, only after 2 years from the start or the last rise, by 5% at a time and at most five times during the lease — unless you agreed otherwise in writing (the Real Estate Lease Law (Law 27/2014)).
How big can the security deposit be?
At most 1 month's rent, returned at the end less what you owe, in Bahrain. Advance rent for a home is at most 3 months.
Does a lease have to be registered?
Yes — in Bahrain, a lease must be in writing and registered within one month of signing; the landlord pays the fixed BHD 5 fee (BHD 10 for other uses — Ministerial Order 9/2015). Courts do not hear claims on unregistered leases.
Is there a municipal fee on rent in Bahrain?
Yes: 10% of the rental value, and never less than the owner-occupier fee (Ministerial Decision 22/2005). The decision does not say who pays; it is usually billed to the occupier with the electricity and water account. Bahraini tenant families who qualify pay the owner rate of BHD 2–14 a month instead.
Is there VAT on rent in Bahrain?
In Bahrain, renting a home is VAT-exempt; hotels and serviced accommodation carry 10% (a lease of a year or more never counts as serviced accommodation).
Where do rent disputes go?
In Bahrain, rent disputes go to the High Civil Court; its judgement is final for claims up to BHD 1,000.