Dubai Rents to continue rising in 2024

Punit Rana
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December 19, 2023

News, Damac hills dubai,Dubai rental properties,Jumeirah lake towers,Rent apartment in dubai

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Dubai Rental properties will continue to rise in 2024, albeit at a more modest pace, due to the undersupply in the market and the influx of foreign professionals and investors into the city.

However, some areas such as Jumeirah Village Circle (JVC) and Tilal Al Ghaf will see a number of handovers next year, giving tenants more options and landlords their money's worth in these neighbourhoods

I see rents continuing to rise at a more moderate pace than in the last two years," says Jacob Bramley, lettings manager at Betterhomes. "There is still an undersupply of properties. We are getting a lot of inquiries and listings are stabilising through the fourth quarter. It's the number of homes that will be handed over next year, offering price competition, that makes me think price rises could be less severe."

According to real estate consultancy Inch&brick, the rate of growth in Dubai's rental market gradually slowed in the third quarter.

“While there has been activity in both the lower and higher rental price segments, certain averages have remained static,” Inchbrick said.

there has been a "significant slowdown” with rent increases of 3 percent, 2 percent and 4 percent for rent apartment in Dubai, villas and offices in the three months. "On an annual basis, the changes were 18 percent, 19 percent and 29 percent respectively,” said Inchbrick.

Bramley said that demand for housing across the city continues to soar, resulting in a shortage of available properties. For landlords, this means minimal to no long vacancy periods, confirming a robust and thriving rental market.

Where will rents rise faster?

Cherif Sleiman, Chief Revenue Officer at Property Finder, says that the preferred areas for apartments are Dubai Marina, Jumeirah Village (JVC), Business Bay, Downtown Dubai and Jumeirah Lake Towers (JLT). For villas, Dubai Hills Estate, Damac Hills Dubai, Al Barsha, Jumeirah and are the most popular areas.

Due to demand and popularity, these areas are expected to see higher rental growth in the coming years.

Data from Property Finder in November shows that one bedroom apartments are in the highest demand. Around 36 percent of people were looking for one bedroom apartments, 30 percent for two bedroom apartments and 24 percent for studios. For villas/townhouses, 42 percent were looking for apartments with three bedrooms and 35 percent for apartments with four or more bedrooms. Furnished rent apartment in Dubai were preferred by 66 percent of tenants, but 32 percent wanted to live unfurnished. For villas/townhouses, 51 percent were looking for unfurnished and 48 percent for furnished,” said Sleiman.

Sleiman believes that new projects in previously undeveloped neighbourhoods will also offer more opportunities to meet growing demand.

“If net in-migration continues to outstrip the delivery of new homes, this will continue to drive up rental prices. It could be that Dubai rental propeties properesidents opt to buy rather than. Should a larger proportion of the population decide to buy their home rather than rent long-term, and should the attractiveness of real estate as an investment opportunity change, this could also determine rental prices in 2024,” he said.