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Coping with Rising Rents in Dubai’s High-Demand Areas

Rents in Dubai High Demand Areas

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Rents in Dubai High Demand Areas

If you’re a tenant in Dubai, you’re probably familiar with the challenges of rising rents in popular neighborhoods. Many tenants like Salim Ahmed are feeling the pinch, but they’re finding creative ways to manage the situation.

Rents in Dubai High Demand Areas

The Rent Hike Challenge:

  • Salim Ahmed received a significant rent increase, pushing his budget to the limit.
  • Despite considering moving to a new apartment, he realized that the costs associated with relocation were substantial and wouldn’t provide significant savings.

Growing Trend of Renewals:

  • Many tenants, like Salim, are choosing to stay put and renew their existing rental agreements.
  • According to CBRE Middle East, there’s been an 8.7% increase in rental transactions in 2023 compared to the previous year, mainly driven by a 28% surge in renewed registrations.
  • New rental contracts, however, have decreased by approximately 12%.

Costs of Relocating vs. Rent Increase:

  • The decline in new rental contracts is attributed to the high costs of moving or signing new leases.
  • Tenants like Noor find that the expenses of relocating are almost as high as the rent increase itself.
  • Moving can also result in wear and tear on household items, making it a less attractive option for those who value their possessions.

Dubai's Rental Market Overview:

  • According to the H1 Dubai Property Market Report by Bayut, affordable apartment rents in popular areas have increased by up to 17%.
  • Luxury apartment rents have seen even steeper hikes, with increases of up to 32%.
  • Reasonably priced villas in sought-after neighborhoods have witnessed rent increases of up to 50%.
  • Luxury villa rentals have surged by up to 70%.
  • There’s been a slight slowdown in the rate of rental growth in recent months, offering some relief to tenants.

Average Rent Increase:

  • CBRE Middle East reported that average rents in Dubai increased by 21.7% in the year up to August 2023.
  • During this period, average apartment rents rose by 21.5%, and average villa rents increased by 22.6%.
  • The rental growth rate has been moderating, marking the seventh consecutive month of this trend, even though demand remains strong.

As the cost of living in Dubai’s high-demand areas continues to rise, many tenants are choosing stability and renewing their existing leases rather than enduring the financial strain of moving. Despite the challenges, there’s hope on the horizon as the rate of rental growth begins to slow down.


Which area in Dubai is best for rental income?
Top 10 areas with the highest rental yield in Dubai in 2024
  • Dubai Marina. …
  • Dubai Hills Estate (Villas) …
  • Jumeirah Golf Estates. …
  • Jumeirah Beach Residence. …
  • Business Bay. …
  • Downtown Dubai. …
  • Palm Jumeirah Apartments. …
  • City Walk.
What is the most demanded area in Dubai?

According to the study, the most popular areas are Dubai Marina, JVC, and Dubai Hills. 

Which area has highest ROI in Dubai?

The three top-performing areas that delivered the highest returns on investment for apartment investors according to the Bayut report were Dubai Silicon Oasis, Jumeirah Village Circle, and Dubai Production City.

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