Dubai is quickly becoming an attractive place for both investors and homeowners. Experts believe that rental prices in the city will rise significantly with short-term rentals (those lasting less than six months) expected to go up by about 18% and long-term leases (lasting six months or more) likely increasing by 13%. This trend is largely driven by more people relocating to Dubai, lured by its booming job market, improved quality of life and rising property values.

Key Factors Behind Rental Increases

The Expat Insider 2024 report highlights Dubai as the 10th-best place for expats to live, and it’s easy to see why. The city offers a great quality of life and plenty of job opportunities. With attractive salaries, a lively lifestyle and state-of-the-art infrastructure, Dubai has become a top choice for people from around the world looking to build their careers and enjoy a better life.

As property prices keep rising, landlords are likely to increase rental rates. With more professionals and expats choosing to live in Dubai, the demand for housing is higher than ever and many people are willing to pay more for a place to call home.

Dubai’s ongoing development of new attractions and business centers adds to its appeal. Big events like international exhibitions and conferences also drive up demand for short-term rentals. During these times, the price for a one-bedroom apartment in downtown Dubai can surge to over AED 10,000 per night.

Current Market Trends

Rental prices have already increased by approximately 16% this year, a trend expected to persist into 2025. For example, a short-term lease for a one-bedroom apartment in Jumeirah Lakes Towers now averages AED 10,700 per month, compared to AED 9,500 for a long-term lease.

Market Outlook and Predictions

The overall market outlook indicates that 182,000 new housing units will be added between 2025 and 2026, with 76,000 units expected to be completed in 2025 alone.

For people currently renting or thinking about moving to Dubai, these expected rent increases are important to consider. Experts suggest that tenants get ready for possible hikes, with projections showing an average rise of at least 13% in the next few years. In some cases, renters might even see increases of up to 25%. To manage these changes effectively, it will be essential for renters to focus on smart financial planning and budgeting.