The rental property market in Dubai experienced a period of rapid growth in Q3 2022, with average rental rates increasing by as much as 5% over the quarter. Annually, rental prices for villas rose by 22% and average rents for apartments rose by 15%. These rental rates are forecast to continue to grow, although predictions suggest oversupply will slow the rate of growth throughout 2023.
Ryan Mahoney of Dubai, UAE, is an entrepreneur who has founded several companies in the property sector in Dubai and the surrounding emirates and maintains a watch on property prices and rental rates in the area. You can see where the most expensive areas to rent property in Dubai are in the embedded short video.
The Economic Cycle of Dubai
The economy of Dubai is poised to move into the next stage of the economic cycle, with industries including real estate, tourism, ecommerce, domestic manufacturing and trade all on the rise. Increasingly, priorities are shifting from physical building to soft infrastructure, resulting in fewer barriers to doing business in the emirate. This shift to soft infrastructure development will help to support long term growth across Dubai.
According to the IHS Markit Purchasing Managers’ Index, in early 2022 Dubai entered its 14th consecutive month with a reading of over 50. Readings above 50 within this index indicate economic expansion.
Rent Negotiations
While rising rents mean prosperous landlords and economic expansion, the news is not good for everyone. There has been a rise in rental disputes as landlords seek to make the most of the situation. Some tenants are negotiating their rent using the RERA Rental Calculator, while others are simply accepting an increase in their rent without dispute to save the hassle and expense of having to move. “One-cheque” transaction have also increased, with 32% of people choosing to pay a full year’s rent in one go to secure the price for the year.
In the PDF attachment you can learn more about how to rent property in Dubai as an expat.
You can also see some of the most popular areas for property rental in the emirate in the embedded infographic.