Dubai apartment rental market is set for a significant upswing in 2025, with experts predicting rental hikes of over 18% for short-term leases and 13% for long-term contracts. The city’s appeal as a global professional hub and lifestyle destination, coupled with rising property prices, is fueling this rental surge.
Post-Stabilisation Boom in Dubai Rentals
After a period of stabilisation in Dubai’s real estate sector, rental demand is climbing again. Ritesh Mehta, Senior Director at JLL India, attributes this to a consistent influx of professionals and a pro-business environment. While new apartment and villa developments — over 100,000 units projected within 15 months — aim to ease the pressure, high demand is keeping rental values strong.
Prime areas like Dubai Marina, Downtown Dubai, Business Bay, and Jumeirah Village Circle are already experiencing high activity. According to ANAROCK Group, rental escalations of 10–15% are expected in these sought-after neighborhoods.
Affordability Challenges Drive Rental Demand
Dubai apartment real estate has become increasingly unaffordable for buyers due to rising home prices and fluctuating borrowing costs. This has pushed many potential buyers into the rental market. Regulatory changes, including long-term residency visas, have also bolstered the rental sector, providing flexibility for expats and investors.
Rental Yields Stabilise Amid Growing Demand
With strong demand and a growing population, Dubai’s rental yields remain attractive. Average yields hover around 6–7%, with prime areas exceeding 8%. Diverse rental options cater to a range of budgets, making Dubai a key market for investors.
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Indian Investors Eye Dubai Real Estate
Indian investors are seizing financing options, from UAE mortgages to loans against properties in India. Developers in Dubai also offer flexible payment plans, including schemes that allow rental payments to contribute towards ownership. These options enhance Dubai’s allure as a lucrative investment destination for NRIs.
