It is a common understanding that every business industry has its trends and opportunities and the success of the organizations depends on how they can effectively seize these opportunities and turn them into productive gains.

Recent data shows that the property market in Dubai has expanded significantly in the last decade and current average rental yields range from 5 – 8% per annum. Because Dubai is one of the most globalized cities in the world more expats from different parts of the world seek employment opportunities in the city, making the tenant markets a viable investment option. This paper aims to describe the newest trends regarding the properties for rent in Dubai and the areas that could be considered more suitable for investments in rental properties.

The Current State of Market Rent in Dubai

Currently, the Dubai rental market has significant demand with a limited offering of affordable housing stock. The growth of the foreign population in the past ten years has been a significant factor that has kept pressure on yields on almost all classes starting from studio apartments and going up to luxury villas. According to the latest data from real estate advisory firm Core, rents across Dubai grew as much as 30 percent in 2021. Places such as Downtown Dubai, Dubai Marina as well and Palm Jumeirah are some of the areas that appeal to the lifestyle aspect hence experiencing a high price surge. Shortage of affordable housing has also deprived tenants of larger space as they pay high rents for their humble homes.

Prospective destinations to lease property in Dubai

As an investor who is planning to invest in the rental market of Dubai, there are certain points that one has to assess in areas such as the infrastructure, community facilities, possible returns, and tenants. Given below are some of the top neighborhoods for buying rental apartments, villas, and townhouses in Dubai: Given below are some of the top neighborhoods for buying apartments for rent in Dubai, villas for rent in Dubai, and townhouses in Dubai:

– Dubai Silicon Oasis:

Many of the technology and manufacturing companies are establishing their regional offices. And, as such, there is high demand for cheap houses in this region. In terms of rental yields. It is estimated that studios and 1-bed units can be leased out to generate yields of between 7-8%.

– Jumeirah Village Circle:

This new community next to ‘New Dubai’ has attracted families and millennials, due to its large villa projects. Overall return on investment up to 10% on 2,3- & 4-bedroom townhouses.

– Business Bay

Specifically, Dubai is the hub of the Middle East and has been the host of Expo 2020. Like, commercial and residential properties. Residential waterfront luxury apartments can generate rental returns of between 7% and 9% per annum.

– Damac Hills

It is specifically marketed as Dubai’s most accessible master community for affordable homes. With available villas, townhouses, and apartments for rent and sales that boast reasonable rental returns. New investors in the property market will have a seamless experience when investing in the Studio and 1-bed units.

In this case, the trends that are emerging in the rental market of Dubai are important to consider.

According to the Dubai 2040 urban master plan. It’s need to have adequate affordable housing units to cater for the rental needs. It mainly deals with comprehensive community planning outside central Dubai to create integrated and sustainable communities. Investors should track the following emerging trends:

– Further regulation to govern the rental market and ensure better rights for tenants to enhance the rates of stable residency

– The need for bigger dwellings and additional features such as a private swimming pool or garden resulting.

– A conversion strategy where hotels/lodges are converted into long-term branded rental apartment buildings for millennial residents

– This has been evident in yield rates for off-plan projects situated in the emerging corridors of Dubai land and Meydan.

However, if we consider the long-term trends for the rental market in Dubai. The outlook remains positive due to the diverse economy and the potential for attracting tenants from all over the world. Investors seeking to obtain stable recurring revenues. Which would not depend on the performance of the companies. Companies can find potentially attractive risk-return profiles for both affordable and premium segments of the rental property market. The other crucial factors that one needs to consider before investing include location factors. Property type, target tenant profile, and yield forecast.

All we can say is, make sure you enable market research before investment. Happy investing to you!