Authored by the expert who managed and guided the team behind the United Arab Emirates Property Pack
Yes, the analysis of Dubai's property market is included in our pack
If you own a residential property in Dubai or plan to buy one, you are probably wondering how renting it out really works in 2026.
This guide covers everything you need to know about rental yields, legal requirements, short-term versus long-term strategies, and which neighborhoods perform best for landlords in Dubai right now.
We constantly update this blog post to reflect the latest market data and regulatory changes in Dubai's rental sector.
And if you're planning to buy a property in this place, you may want to download our pack covering the real estate market in Dubai.
Insights
- Dubai landlords can expect around 6.5% to 7% gross rental yields in 2026, which is roughly double what you would earn in London or New York for comparable properties.
- The RERA Smart Rental Index now updates in real time using AI, which means your permitted rent increase at renewal is tied to current market data rather than a yearly snapshot.
- Affordable neighborhoods like International City and Dubai Investment Park deliver yields of 9% to 10%, outperforming prime areas like Downtown Dubai on a pure return basis.
- Dubai expects around 120,000 new residential units to be handed over in 2026, but historically only 60% to 70% actually complete on schedule, limiting the oversupply risk.
- Short-term rental occupancy in Dubai averages around 66% to 72% annually, with December being the peak month and August being the slowest.
- Furnished rentals in Dubai typically command a 10% to 20% premium over unfurnished units and rent faster due to the city's high expat population seeking turnkey solutions.
- Service charges in Dubai apartment buildings can eat 1.5% to 2.5% of your property value annually, making them the largest hidden cost for overseas landlords.
- The Dubai holiday home permit system requires strict compliance, and around 85% of active short-term rental listings are now licensed according to recent platform data.
Fact-checked and reviewed by our local expert
Ines Benaddi 🇲🇦🇫🇷
Real Estate Agent, Dubai Real Estate
Can I legally rent out a property in Dubai as a foreigner right now?
Can a foreigner own-and-rent a residential property in Dubai in 2026?
As of early 2026, foreign individuals can legally purchase residential property in Dubai's designated freehold areas and rent it out to tenants without any nationality restrictions on ownership or landlord status.
The most common ownership structure for foreigners is full freehold ownership in designated zones such as Dubai Marina, Downtown Dubai, Palm Jumeirah, and Jumeirah Village Circle, which gives you complete property rights including the ability to lease the unit.
The main limitation is geographic: foreigners can only buy in designated freehold areas rather than anywhere in Dubai, but these zones cover most of the popular residential and investment neighborhoods.
If you're not a local, you might want to read our guide to foreign property ownership in Dubai.
Do I need residency to rent out in Dubai right now?
You do not need to be a UAE resident to own and rent out property in Dubai, which means you can be a landlord while living anywhere in the world.
A local tax identification number is generally not required for individual landlords collecting residential rental income, although you should review the Federal Tax Authority's guidance on corporate tax for natural persons to confirm your specific situation.
While a local bank account is not legally mandatory, most overseas landlords find it practically essential because rent payments and service charges typically flow through UAE banking channels.
Managing a Dubai rental remotely is entirely feasible if you use a licensed property management company to handle Ejari registration, tenant sourcing, maintenance, and rent collection on your behalf.
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What rental strategy makes the most money in Dubai in 2026?
Is long-term renting more profitable than short-term in Dubai in 2026?
As of early 2026, short-term rentals can generate 10% to 35% higher gross revenue than long-term rentals in prime tourist areas like Dubai Marina, Downtown, and Palm Jumeirah, but they come with significantly higher operating costs and management complexity.
A well-managed one-bedroom apartment in a prime Dubai location might earn around AED 110,000 to AED 130,000 per year (roughly USD 30,000 to USD 35,000 or EUR 28,000 to EUR 33,000) on long-term rental, compared to AED 140,000 to AED 160,000 (roughly USD 38,000 to USD 44,000 or EUR 35,000 to EUR 41,000) on short-term rental before operating expenses.
Short-term renting tends to outperform financially in neighborhoods with strong tourist demand, waterfront access, and proximity to attractions, while commuter-focused areas like Dubai Silicon Oasis or Al Nahda favor long-term tenancies.
What's the average gross rental yield in Dubai in 2026?
As of early 2026, the average gross rental yield for residential properties in Dubai sits around 6.5% to 7%, which remains significantly higher than most major global cities.
The realistic range spans from about 5% in premium neighborhoods like Palm Jumeirah to 10% or more in affordable high-yield areas like International City and Dubai Investment Park.
Studios and one-bedroom apartments typically achieve the highest gross yields in Dubai because they have strong rental demand from young professionals and offer lower purchase prices relative to rent.
By the way, we have much more granular data about rental yields in our property pack about Dubai.
What's the realistic net rental yield after costs in Dubai in 2026?
As of early 2026, the average net rental yield for a typical overseas landlord in Dubai falls around 4% to 5% after all operating costs are deducted.
The realistic range runs from about 3% in high-cost buildings with expensive service charges to around 5.5% or 6% in well-chosen affordable communities with lower overheads.
The three main cost categories that eat into your gross yield in Dubai are service charges (which can be surprisingly high in tower apartments), property management fees (typically 5% to 8% of rent), and vacancy or re-letting costs between tenants.
You might want to check our latest analysis about gross and net rental yields in Dubai.
What monthly rent can I get in Dubai in 2026?
As of early 2026, typical monthly rents in Dubai run around AED 4,500 (USD 1,225, EUR 1,150) for a studio, AED 7,000 (USD 1,900, EUR 1,800) for a one-bedroom, and AED 10,500 (USD 2,850, EUR 2,700) for a two-bedroom apartment.
A decent studio in an affordable Dubai neighborhood like International City or Dubai Silicon Oasis typically rents for AED 3,000 to AED 4,500 per month (USD 815 to USD 1,225, EUR 770 to EUR 1,150).
A standard one-bedroom apartment in mid-market communities like Jumeirah Village Circle or Al Furjan typically fetches AED 5,500 to AED 8,000 per month (USD 1,500 to USD 2,180, EUR 1,400 to EUR 2,050).
A two-bedroom apartment in established areas like Dubai Marina or Business Bay generally rents for AED 9,000 to AED 14,000 per month (USD 2,450 to USD 3,800, EUR 2,300 to EUR 3,600).
If you want to know more about this topic, you can read our guide about rents and rental incomes in Dubai.
We did some research and made this infographic to help you quickly compare rental yields of the major cities in the UAE versus those in neighboring countries. It provides a clear view of how this country positions itself as a real estate investment destination, which might interest you if you’re planning to invest there.
What are the real numbers I should budget for renting out in Dubai in 2026?
What's the total "all-in" monthly cost to hold a rental in Dubai in 2026?
As of early 2026, the total all-in monthly cost to hold a rental property in Dubai (excluding mortgage payments) runs around AED 1,600 (USD 435, EUR 410) for a studio, AED 2,200 (USD 600, EUR 565) for a one-bedroom, and AED 3,000 (USD 815, EUR 770) for a two-bedroom apartment.
The realistic range spans from about AED 1,200 per month (USD 325, EUR 310) for a low-cost building in an affordable area to AED 5,000 or more (USD 1,360, EUR 1,280) for a premium tower with high service charges and full management.
Service charges are typically the single largest cost for Dubai apartment owners and can range from AED 12 to AED 30 per square foot annually depending on the building's age, amenities, and management quality.
You want to go into more details? Check our list of property taxes and fees you have to pay when buying a property in Dubai.
What's the typical vacancy rate in Dubai in 2026?
As of early 2026, the typical vacancy rate for long-term rentals in Dubai runs around 6% to 8% annually, though forecasts suggest this could rise to around 12% as new supply enters the market.
For budgeting purposes, you should plan for approximately one month of vacancy per year in a well-located property, or up to two months if your unit is overpriced, poorly maintained, or faces heavy competition from new buildings.
Vacancy rates vary significantly by neighborhood: areas with large new supply pipelines like Jumeirah Village Circle and Business Bay tend to see higher vacancy, while established communities with limited new stock remain tighter.
The summer months from July to September typically see the highest tenant turnover and vacancy in Dubai because extreme heat, school holidays, and slower business activity prompt some residents to leave or delay moving.
We have a whole part covering the best rental strategies in our pack about buying a property in Dubai.
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Where do rentals perform best in Dubai in 2026?
Which neighborhoods have the highest long-term demand in Dubai in 2026?
As of early 2026, the three neighborhoods with the highest overall long-term rental demand in Dubai are Dubai Marina, Jumeirah Village Circle (JVC), and Business Bay, which consistently rank as the most searched and transacted areas on major portals.
Families with children tend to concentrate their rental searches in communities like Dubai Hills Estate, Arabian Ranches, Mirdif, and The Springs, where they can find larger units, community parks, and proximity to schools.
Students and early-career renters gravitate toward affordable, well-connected areas like Dubai Silicon Oasis, Academic City, Al Nahda (Dubai side), and Discovery Gardens, where rents are lower and commutes to universities or business districts remain manageable.
Expats and international professionals typically seek lifestyle-oriented neighborhoods like Dubai Marina, Downtown Dubai, JLT (Jumeirah Lake Towers), and Palm Jumeirah, where they find walkability, dining, and social amenities.
By the way, we've written a blog article detailing what are the current best areas to invest in property in Dubai.
Which neighborhoods have the best yield in Dubai in 2026?
As of early 2026, the three neighborhoods with the best rental yields in Dubai are International City, Dubai Investment Park, and Discovery Gardens, where gross yields can reach 9% to 10.5% due to low purchase prices and steady rental demand.
These top-yielding neighborhoods typically deliver gross rental yields in the range of 8% to 10.5%, compared to the citywide average of around 6.5% to 7%.
The main characteristic that allows these neighborhoods to achieve higher yields is their low entry price per square foot combined with consistent demand from budget-conscious tenants, which creates a favorable rent-to-price ratio that prime areas cannot match.
We cover a lot of neighborhoods and provide a lot of updated data in our pack about real estate in Dubai.
Where do tenants pay the highest rents in Dubai in 2026?
As of early 2026, the three neighborhoods where tenants pay the highest rents in Dubai are Palm Jumeirah, Downtown Dubai, and Jumeirah Bay Island, where premium waterfront locations and iconic addresses command top prices.
A standard two-bedroom apartment in these premium neighborhoods typically rents for AED 180,000 to AED 350,000 per year (USD 49,000 to USD 95,000, EUR 46,000 to EUR 90,000), with luxury villas and penthouses reaching much higher.
The main characteristic that drives these premium rents is a combination of scarcity (limited land and restricted supply), world-class amenities, and the "trophy address" factor that attracts wealthy tenants willing to pay for prestige and lifestyle.
The typical tenant profile in these highest-rent neighborhoods includes senior executives, ultra-high-net-worth individuals, and corporate-sponsored expatriates who prioritize location, security, and premium finishes over value.
We created this infographic to give you a simple idea of how much it costs to buy property in different parts of the UAE. As you can see, it breaks down price ranges and property types for popular cities in the country. We hope this makes it easier to explore your options and understand the market.
What do tenants actually want in Dubai in 2026?
What features increase rent the most in Dubai in 2026?
As of early 2026, the three property features that increase monthly rent the most in Dubai are metro proximity (especially the new Blue Line stations), a maintained building with responsive management, and included parking with easy access.
Metro proximity alone can add a 10% to 15% rent premium in areas like Dubai Silicon Oasis and JVC where the new metro expansion is improving connectivity.
One commonly overrated feature in Dubai is an ultra-modern kitchen with high-end appliances, which tenants appreciate but rarely pay significantly more for compared to a standard functional kitchen.
One affordable upgrade that delivers strong returns for Dubai landlords is high-speed internet infrastructure and smart home basics like a smart lock and thermostat, which appeal to the city's tech-savvy expat tenant base.
Do furnished rentals rent faster in Dubai in 2026?
As of early 2026, furnished apartments in Dubai typically rent one to three weeks faster than unfurnished units because the city's large expat population often seeks turnkey move-in solutions.
Furnished apartments in Dubai generally command a rent premium of 10% to 20% over comparable unfurnished units, with the premium being highest in areas popular with short-term corporate tenants and new arrivals.
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How regulated is long-term renting in Dubai right now?
Can I freely set rent prices in Dubai right now?
At the start of a new lease, landlords in Dubai have full freedom to negotiate and set the initial rent at any price the market will bear.
However, rent increases at renewal are regulated by the RERA Smart Rental Index, with increases capped at 0% to 20% depending on how far below the market average your current rent sits, and landlords must give 90 days written notice before any increase takes effect.
What's the standard lease length in Dubai right now?
The standard lease length for residential rentals in Dubai is one year, which is the dominant norm used in the market and embedded in the Ejari registration system.
Security deposits in Dubai are typically quoted as 5% of annual rent for unfurnished apartments and 10% for furnished units, though these amounts are negotiable and should be clearly stated in the Ejari-registered contract.
At the end of a tenancy, landlords must return the security deposit within 60 days after the tenant vacates, minus any legitimate deductions for damage beyond normal wear and tear, unpaid bills, or other contractual obligations.
We made this infographic to show you how property prices in the UAE compare to other big cities across the region. It breaks down the average price per square meter in city centers, so you can see how cities stack up. It’s an easy way to spot where you might get the best value for your money. We hope you like it.
How does short-term renting really work in Dubai in 2026?
Is Airbnb legal in Dubai right now?
Yes, Airbnb-style short-term rentals are legal in Dubai, but only if you operate under the official holiday home permit system regulated by the Dubai Department of Economy and Tourism (DET).
A holiday home permit is required to legally operate a short-term rental in Dubai, and you can apply through the DET portal or work with a licensed holiday home operator who handles compliance on your behalf.
Dubai does not impose a strict annual night limit like some European cities, but your building or community may have its own restrictions through NOC (No Objection Certificate) requirements.
Operating an unlicensed short-term rental in Dubai can result in fines starting from AED 5,000 and escalating with repeat violations, along with potential listing removal from platforms.
By the way, we also have a blog article detailing whether owning an Airbnb rental is profitable in Dubai.
What's the average short-term occupancy in Dubai in 2026?
As of early 2026, the average annual occupancy rate for short-term rentals in Dubai sits around 66% to 72%, which translates to roughly 240 to 265 booked nights per year for a typical listing.
The realistic range spans from about 50% occupancy for entry-level or poorly managed listings to 75% or higher for well-located, professionally managed properties in prime areas.
The highest occupancy months in Dubai are October through December and January through March, when cooler weather, major events, and peak tourism season drive strong demand.
The lowest occupancy months are July through September, when extreme summer heat and the Ramadan period (timing varies) reduce tourist arrivals significantly.
Finally, please note that you can find much more granular data about this topic in our property pack about Dubai.
What's the average nightly rate in Dubai in 2026?
As of early 2026, the average nightly rate for short-term rentals in Dubai runs around AED 700 to AED 850 per night (roughly USD 190 to USD 230, EUR 180 to EUR 220), depending on the data source and property mix.
The realistic range spans from about AED 450 per night (USD 120, EUR 115) for budget listings in affordable areas to AED 1,800 or more (USD 490, EUR 460) for premium waterfront or luxury properties.
Peak season rates in December and January can run 30% to 50% higher than off-season rates in August, with the swing adding roughly AED 200 to AED 400 per night (USD 55 to USD 110, EUR 50 to EUR 100) in prime areas.
Is short-term rental supply saturated in Dubai in 2026?
As of early 2026, Dubai's short-term rental market is highly competitive with over 15,000 to 22,000 active listings depending on the data source, making it one of the largest STR markets in the Middle East.
The number of active short-term rental listings in Dubai has grown significantly over the past two years, with some sources reporting 30% to 36% year-over-year growth, though growth may moderate as the market matures.
The most saturated neighborhoods for short-term rentals in Dubai are Dubai Marina, Downtown Dubai, and Business Bay, where high listing density creates intense competition for guest bookings.
Neighborhoods that still have room for new short-term rental supply include emerging areas like Dubai South, Arjan, and parts of JVC where tourist infrastructure is developing and competition remains lower.
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What sources have we used to write this blog article?
Whether it's in our blog articles or the market analyses included in our property pack about Dubai, we always rely on the strongest methodology we can and we don't throw out numbers at random.
We also aim to be fully transparent, so below we've listed the authoritative sources we used, and explained how we used them and the methods behind our estimates.
| Source | Why it's authoritative | How we used it |
|---|---|---|
| Dubai Land Department Rental Index | This is Dubai's official rental benchmark tool used to determine lawful rent increases. | We use it as the ground truth for how rent increases are calculated in Dubai. We also use it to anchor our long-term rent assumptions to an official reference point. |
| Dubai Land Department Ejari Portal | This is the official portal for tenancy contract registration in Dubai. | We use it to confirm that tenancy registration is part of the standard rental workflow. We also use it to explain what landlords can do remotely versus what needs local support. |
| Dubai DET Holiday Home Permit | This is the official government process for legal short-term renting in Dubai. | We use it to answer whether Airbnb is legal in Dubai. We also use it to outline what permits and approvals sit behind legal STR operations. |
| Bayut Dubai Rental Market Report 2025 | Bayut is one of the UAE's biggest portals with methodology-driven market summaries. | We use it to estimate realistic rents for studios, one-bedrooms, and two-bedrooms across popular communities. We use it to add neighborhood-level texture that official indexes don't present. |
| dubizzle Dubai Rental Market Report 2025 | dubizzle is another major marketplace that cross-checks pricing by segment. | We use it to triangulate rent levels and identify which areas have strongest demand. We also use it to sanity-check our "what tenants pay" ranges for early 2026. |
| AirDNA Dubai Overview | AirDNA is a widely used STR data provider tracking Airbnb and Vrbo performance. | We use it to estimate occupancy, ADR, and revenue for short-term rentals in Dubai. We also use it to discuss market saturation using real listing counts. |
| Global Property Guide UAE Rental Yields | It's a long-running international dataset that publishes comparable gross yields by country. | We use it to anchor a citywide gross-yield estimate for early 2026. We then adjust Dubai-specific ranges using local rent reports and consultancy context. |
| CBRE UAE Real Estate Market Review Q3 2025 | CBRE is a top global real estate consultancy with established research methods. | We use it to triangulate the direction of rents and supply-demand conditions going into 2026. We use it as a professional second opinion alongside government tools. |
| Knight Frank Dubai Residential Market Review | Knight Frank is another top-tier global consultancy with transparent market reporting. | We use it to cross-check market momentum, pricing pressure, and investor context near 2026. We use it to keep our yield and rent assumptions consistent with major-firm research. |
| Federal Tax Authority UAE | This is the UAE's tax regulator explaining how VAT and corporate tax apply to real estate. | We use it to clarify tax treatment around residential leasing at a high level. We use it to keep the rental-income discussion realistic for individual landlords. |
We have made this infographic to give you a quick and clear snapshot of the property market in the UAE. It highlights key facts like rental prices, yields, and property costs both in city centers and outside, so you can easily compare opportunities. We’ve done some research and also included useful insights about the country’s economy, like GDP, population, and interest rates, to help you understand the bigger picture.
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