I don’t mean to be the bearer of bad news, but rents in Dubai are expected to jump another 10% in the second half of 2024, matching the increase seen in the first half of the year. Some areas have already seen rent hikes up to AED 150,000. This trend is fueled by a growing population, an influx of wealthy individuals, and a booming economy creating new jobs. Keep reading to find out why this new increase has come in.
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Rent Predictions From Industry Experts
Jacob Bramley, senior leasing manager at Betterhomes, expects a steady 5-10% rent increase over the next six months due to more property handovers in the third and fourth quarters of the year. Similarly, Lewis Allsopp, chairman of Allsopp and Allsopp, anticipates a more gradual rental growth in late 2024 and into 2025, with over 10,000 new units expected in the second quarter alone.
Growing Demand & New Residents
Dubai’s population growth is a key factor in the rental market surge. Over 30,000 new residents moved to Dubai in the first five months of 2024, and a new report predicts an influx of over 6,700 millionaires. To meet this rising demand, more units are being handed over, and landlords are offering flexible payment options, like multiple cheques, to help tenants cope with the rising costs.
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H1 2024 Rental Performance
In the first half of 2024, average rents across Dubai rose by 15.7% compared to the same period in 2023. Apartments and townhouses saw nearly a 15% increase, while villas experienced an 18% hike. This increase includes previously undervalued units brought up to market average by the updated Rera Index.
Areas With The Highest Rent Increases
Jumeirah Beach Residence (JBR), Town Square, Dubai Production City, Dubai Healthcare City 2, and Meydan saw the highest rent increases, with jumps of 21 to 22% in the first half of 2024. Dubai South saw a staggering 38% rise in average rents, driven by the announcement of the new Al Maktoum Airport. While luxury communities like Jumeirah Islands and Al Barari experienced even more significant rent hikes. Jumeirah Islands saw a 43% increase, with average rents reaching AED 500,000 in H1 2024 compared to AED 350,000 last year. Al Barari’s average rent increased by 39%, from around AED 300,000 last year to approximately AED 400,000 in the first half of this year.
As we move into the latter half of 2024, renters should brace for higher costs but also take advantage of the diverse and expanding housing options available in this vibrant city.
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