In recent years, the landscape of rental properties in Dubai has seen a notable shift, marked by a consistent increase in rents across most areas.
Previously common incentives like rent-free months or grace periods allowing early occupancy without payment have become scarce commodities in the Dubai rental market. This shift can be attributed to landlords benefiting from high occupancy rates, a consequence of the burgeoning population in the emirate.
Executives in the real estate industry have noted this trend, highlighting a willingness among landlords to offer rent payment plans spread over multiple checks. However, this often results in tenants paying a higher overall rental price. The surge in demand, driven by population growth and exacerbated by pandemic-related project suspensions, has fueled double-digit rent increases in many parts of Dubai over recent years.
Jacob Bramsley, a leasing manager at Betterhomes, observed a decline in incentives such as free rent months or grace periods, citing high occupancy rates as reducing pressure on landlords to offer such perks. Instead, flexibility is more commonly found in rental payment structures.
Paul Kelly, operations director at Allsopp & Allsopp Group, echoed this sentiment, noting the diminishing need for incentives among landlords given the bustling nature of Dubai's current market. With the emirate's population reaching 3.65 million in 2023, driven by an influx of foreign workers and investors post-pandemic, the demand for housing has intensified, tilting the market heavily in favor of landlords.
Alois Kugendran, general manager for real estate at Huspy, emphasized the scarcity of available homes due to population growth, resulting in a landlord-favoring market with limited options for tenants. This shift marks a departure from conditions seen in previous years.
In contrast, Alina Adamco, head of sales at Metropolitan Homes, noted that in newly developed areas, tenants may still find opportunities for better deals, as landlords may offer incentives like payment plans or free utilities to attract occupants. However, the decision ultimately rests with the landlord, who may opt to keep properties vacant rather than compromise on rental terms.
The evolving dynamics of the Dubai rental market reflect a shift towards a landlord-centric environment, driven by population growth and a corresponding surge in demand for housing. As incentives wane and rental prices climb, tenants face an increasingly challenging landscape in securing affordable accommodations.
