Dubai holiday homes are also starting to serve businesses
There has perhaps been no better time to be a property investor in Dubai than now – the market is busier than ever, especially when it comes to prime real estate. The first quarter was filled with spectacular highs and more than halfway through the second quarter, things continue to look good.
Another key segment of the market that has seen growth is short-term rentals – there has been a 100% increase in demand from 2020 to 2021, and occupancy levels have remained well above 80% throughout the year. There were brief dips coinciding with the rise of the Delta and Omicron variants, but as the UAE continues to bring the pandemic under control, it remains a haven for those looking for a relaxing short break.
Expo was a major driver of short-term rentals in 2021 – but a post-Expo Dubai is attracting sustained interest from international renters.
Price is no object
It’s no surprise that in the age of AirBnb, Dubai has become a key city for vacationers. Whether you’re looking for the perfect beach getaway, the comfort of a quiet suburban neighborhood, or prefer to stay in the heart of the cityscape, this city has something for everyone. Dubai Marina and Downtown Dubai consistently top the list, offering a comprehensive lifestyle offering that combines retail, dining and leisure.
At the upper end of the market, Palm Jumeirah is the neighborhood’s pick with villas costing up to 4 million dirhams a month – the price of buying a townhouse in one of the world’s most popular residential communities. Dubai power stations.
For the right property and, more importantly, the right lifestyle, renters don’t hesitate to pay a premium. There is also an increase in the number of corporate tenants. Multinational companies are always on the lookout for the best serviced residences where they can place senior executives. The cost of housing being borne by the company, the price takes second place compared to the quality of life offered.
Short term solutions
The growth of the short-term rental market is a particularly attractive proposition for property sellers and owners, although some of them may not yet realize it. If a seller is struggling to sell their home – because the price isn’t market-ready or for some other reason – a short-term rental is a great option to consider.
This is something that is particularly noticeable in prime villa communities, where the market tends to move at a slightly slower pace than apartments. Rather than letting your home languish on the open market, rent it out for a few months. You then benefit from the double benefit of a rental income in the interim, and the sale price once the property has been sold. The same goes for landlords who have not yet obtained an annual lease on their property.
There would be costs associated with putting a house up for short-term rental whether the owners decide to convert it into a holiday home themselves or work with an agency to do so. The result is worth it.
Investors in particular can find that they generate fantastic returns on a monthly basis compared to an annual rental. There are so many people looking to enjoy all the comforts of home living during a short stay in the city and they are willing to stretch their budget if the location is perfect.
Flexibility is the future
Flexibility is the key factor that attracts people – you can rent a house for a month or half a year, and there are even options to rent a full year while paying on a monthly basis instead of being locked into an annual contract. This has created an increase in demand not only from foreign visitors but also from Dubai residents.
In the wake of the pandemic, staycations are often preferable to the hassles of travel – PCR tests, mandatory quarantine periods, the risk of travel protocols changing before you fly back. Thus, residents are looking for short stay options available in the city.
There is still a bit of unpredictability in the world, and there seems to be something new in the news cycle every day. A “return to normal” is still a work in progress, but no matter what is happening all over the world, Dubai is managing to position itself as the city to be.
The number of visitors is expected to continue to advance at a steady pace, and they will only seek out the best options available to them. But we can also expect to see a growth in domestic enquiries, with holidays remaining a viable option for many who still see too many downsides to flying from Dubai.