What Dubai’s Rental Index Can Tell You About Average Rent

April 26, 2019

The price of a rental unit is based on a variety of things, including square footage, number of bedrooms, and location. Knowing how much to charge for an average rent in Dubai is knowing all of these things, as well as demand.

Dubai is one of those places that has seen a lot of growth. It is an interesting place to visit and work in. People come from all over the world for the opportunities this place has to offer. Living here can be exciting, but it also comes with a cost. Of course, that’s true for all places.

If you’re looking for the best way to price your property, you might consider partnering with Blueground. With apartments all over the world, we have the knowledge and expertise to make your investment property work for you and be competitive in the marketplace. We are more than the typical property management company in that we rent premium unfurnished spaces before outfitting them with bespoke furniture, high-end appliances and the like. Blueground sources senior business executives and other tenants looking for monthly leases. We are more than the typical property management company in that we rent premium unfurnished spaces. This will take the burden off you, giving you time to focus on enjoying Dubai at its finest.


What is the rental index?

With the current laws that are in place, as a landlord in Dubai, you are not allowed to increase the rental price on your property at the end of the contract. According to Decree 2, 2011, a price increase can be incurred before the rental contract expires under certain conditions.

When it comes to defining a property, the different types are determined based on how many bedrooms are available in the residential unit. This will make comparing prices of the spaces apples to apples.

Currently, if the amount paid by a tenant is below market rates, then the landlord can increase their rent. Depending on how much lower the rental price is will determine how much the amount can be increased. On average, in 2018, if the current rent was 21–40% lower than market value, it could be marked up by 15%. Other increases are as follows:

  • Rent between 21–30% below market value: 10% increase
  • The price falls between 11–20% below market value: 5% increase
  • If the current amount is below 10% below market value: no increase in rent

Dubai’s Rental Index provides an online calculator for landlords and tenants to see if rent increases are appropriate for certain locations and apartment types. It gives the landlord the opportunity to ensure that they are getting fair market value. If not, they have the opportunity to increase the amount per the law.

average rent dubai home

For tenants, it gives them the opportunity to see if they can or should expect an increase in the rent. If so, they may need to make other living arrangements or redo their budget so that they can afford to stay in the residence they currently occupy.

For both parties, Dubai’s rental index can reduce the number of disputes and issues that might arise when it comes to increases. The calculator is easy to use. It allows landlords and tenants to input the appropriate data. From the expiry date to the area to the number of bedrooms, the information that is gleaned from the calculator can be incredibly beneficial.


Average rent

When it comes to figuring out the average rent in Dubai, using the calculator can be helpful. There are also other sites that have this information that may also be beneficial. If the amount is set to increase, that may not show on certain sites. However, it may be available on the calculator.

Once again, the price will depend on where the unit is located and how many bedrooms it has. It may also be impacted by whether or not it’s furnished. Since these are averages, it’s important for landlords and tenants to realize that they might not be an accurate depiction of the actual price.

To know for sure how much rent is for a unit, contacting the property manager or the landlord is advisable. Again, it may also be beneficial to consult the rental index to determine if there can or will be an increase in price.


Apartment availability

In addition to the number of bedrooms and location, prices can be decided by availability and demand. Currently, prices are falling because there is an abundance of apartments available on the market. This has had an impact on both larger and smaller units.

For some people, moving into a smaller apartment is beneficial. This means that they’ll owe less in rent, but they may be able to get into a neighborhood that is closer to their workplace. For others, having a larger apartment is beneficial. With decreasing rental prices, they have the opportunity to get into a larger space for less money.

man and woman carrying cardboard boxes together in a room that is full of boxes and moving stuff

The rental market in Dubai, like many places, fluctuates. Prices vary from neighborhood to neighborhood. Rental prices can also vary depending on the size of the apartment. It’s important to know what the current market value is. Using the Dubai Rental Index can help a landlord and tenant know if they can increase the rental rate and by how much.

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