UAE: short-term rentals set for 20% increased returns

Asma Ahmed - | UAE

The UAE's short-term rental market is witnessing a surge in popularity as a lucrative second income option for residents.

UAE Short-Term Rentals

Despite facing setbacks during the 2020 pandemic, the market rebounded swiftly due to increased travel post-Covid-19, a phenomenon often referred to as 'revenge travel'. Anna Skigin, CEO of Frank Porter, noted that short-term rentals offer higher returns and flexibility, providing property owners with complete control over their assets. Compared to long-term rentals, short-term lets yield approximately 20% higher returns over a two- to five-year period.

Skigin highlighted a trend where new property owners in Dubai immediately opt for short-term rentals upon entering the real estate market. Additionally, existing property owners are selling units with short-term rental potential, considering it a selling point. The short-term rental model consistently generates income, according to Skigin, benefiting owners who have engaged in it for several years.

Many property buyers, particularly in Dubai, are listing their assets for short-term rentals to capitalize on the rising rental market. Growing tourist numbers further support this trend, with Dubai witnessing a record 17.15 million international overnight visitors in 2023, a 19.4% increase from the previous year. Key areas like Dubai Marina, JBR, Palm Jumeirah, and Downtown offer high returns per night, while emerging areas like JLT, JVC, and Maydan are also becoming lucrative.

According to Laura Adams, sales director at Provident Real Estate, the increase in rentals in Dubai was caused by a combination of factors, including the recovery from the pandemic and a move towards short-term leasing as a strategy to increase profits.

Rents have been steadily rising over the last three years, and real estate transactions have hit historic highs. After seeing a 15% rise in January and February figures compared to 2023, Skigin voiced confidence about the future of 2024. The expanding market for short-term rentals in other emirates, such as Ras Al Khaimah and Abu Dhabi, was another trend she brought up.

Skigin emphasized the continuation of longer stays, with individuals opting to work from their holiday rentals. She also viewed initiatives like the single GCC tourist visa positively, expecting them to further bolster the market.

About Author

Asma Ahmed
Asma Ahmed
1483 Total posts

Read Also

The UAE issues new procedures regarding residence visas

The Digital Government of the United Arab Emirates has released a statement stating that foreign nationals who are currently working or living in the UAE and who have made the decision to leave the country permanently are required to ensure that the...

Sharjah Authority directs to receive urgent aid requests for stranded families

The Sharjah Emergency, Crisis, and Disaster Management Team has issued directives to the Sharjah Social Services Department to facilitate the provision of essential food supplies and medications to families facing hardship due to unprecedented...

Emirates Roads Authority calls to avoid using the metro at rush hour

The Roads and Transport Authority advised metro users to avoid using the metro during peak times.

Residents of the UAE are warned of a life-threatening danger due to rainwater collecting on roads

Rainfall that has collected on highways poses a potentially fatal risk to residents of the United Arab Emirates.

UAE announces new Golden Visa rules, boosting the Dubai real estate sector