Rents in Dubai: Planning to move? Top areas where rates are rising, falling for flats and villas

High-end areas continue to lead the rise in rentals in Dubai during the first half of 2023 with some traditionally popular areas facing a supply crunch, prompting more people to move towards ownership.

Industry executives say that strong demand for villas led to a massive increase in rents, jumping up to 70 per cent for luxury villas during the January-June period.

According to data released by Bayut, rentals for affordable apartments in Dubai’s popular districts have increased by up to 17 per cent, while the cost of renting luxury apartments appreciated by up to 32 per cent.

In the villa segment, popular neighbourhoods have experienced a jump of up to 50 per cent in rents, whereas the cost of renting luxury villa properties has increased by up to 70 per cent.

“We see the supply-versus-demand dynamics playing out strongly in the rental market, with traditionally popular areas constantly being outpriced because of the supply crunch. The constant increase in rental prices has also prompted more people to take the plunge into homeownership, so the money they are allocating towards real estate ends up creating an asset in the long term,” said Haider Ali Khan, CEO of Bayut and head of EMPG Mena.

According to Taimur Khan, head of research for the CBRE, average rents increased by 22.8 per cent in the year to June 2023. Over the same period, average apartment and villa asking rents grew by 22.7 per cent and 23.1 per cent, respectively.

Here’s a rental guide courtesy of the CBRE:

Areas where apartment rents rose in June

Areas where apartment rents fell in June

Areas where villa rents rose in June

Areas where villa rents dropped in June

Bayut data showed potential tenants have gravitated towards affordable areas such as Jumeirah Village Circle, Bur Dubai, Al Nahda, Deira and International City as rents in these areas have increased between six to 16 per cent.

In the luxury segment, Business Bay, Downtown, Dubai Hills Estate and Palm Jumeirah were the most popular areas among tenants.

In the villa segment, Damac Hills 2, Al Barsha, Arabian Ranches 3, Mirdif, Dubai South, Jumeirah Village Circle and Dubailand dominated the list of tenants in 2023.

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