Short-term vs. long-term rentals in Dubai

Colife is the international rental, purchase and property management company
With the Dubai property market set to grow steadily in 2024–2025, investors are actively looking for the most profitable rental strategies. The two main models — short-term and long-term rentals — offer different levels of returns, risks, and involvement in property management. It is important to understand which one is truly effective for landlords in the current market dynamics, and what role does the Ejari rental registration system play in this.
According to AirROI analytics, in 2024, the average revenue from short-term rentals of an apartment in Dubai was about $28,600 per year with an average occupancy rate of 40.6%. Downtown Dubai, Dubai Marina, and Jumeirah Village Circle (JVC) remain the most profitable areas, especially during the high tourist season in winter. Meanwhile, short-term rental yields are expected to grow by 18% by the end of 2025, according to Colife forecasts, thanks to increased tourism, major international events in the Emirates, and the continued influx of expats.
On the other hand, long-term rentals remain a more stable strategy. According to Colife observations, demand for long-term contracts is high in summer, but it should be taken into account that the summer off-season price is also lower. For example, if you buy an apartment in the fall, then before the high season it is better to rent it out for a short term and earn a lot of money, and in the summer season decide whether he wants to rent it out through Ejari at a lower price.
In 2024, the average yield in popular areas such as Dubai Creek Harbour and International City was between 6% and 9% per annum. According to Colife, long-term rental income is expected to grow by around 13% in 2025, making it attractive to investors who prefer predictable cash flow with minimal management involvement.
Let’s talk about Ejari, the contract registration system, as it is a key element of long-term rentals. Although it provides legal protection for both the landlord and tenant, the system often becomes a source of administrative difficulties and additional costs. Registration of each contract is accompanied by fees (on average 200 AED), which are especially noticeable if there are frequent changes of tenants. Moreover, tenants do not always cooperate with registration, which can lead to conflicts, delays and even litigation.
Ejari also limits the landlord’s flexibility regarding the terms, conditions and changes to the contract. For example, if there is a need to change the rental rate or living conditions, the landlord must make changes through the system, which requires additional time and costs. In the case of short-term rentals, such restrictions are absent, and dynamic pricing allows the landlord to quickly adapt to market realities and seasonality.
The landlord can’t just ask a tenant to move out if he/she wants to sell the property or rent it out for a higher price. The law requires 12 months’; written notice before. (for example, if the landlord wants to use the property yourself or sell it).
However, short-term rentals require significantly more involvement: it is necessary to constantly manage the property, ensure cleaning, communicate with tenants, and actively promote the property on online platforms. Such tasks take a lot of time and effort from the owner, and if he is not in Dubai, some tasks become impossible. Therefore, they are often entrusted to specialized management companies, which reduces net profitability by an average of 15-20% depending on the service package. But it’s worth it.
— The choice between short-term and long-term rentals depends on the landlord’s goals. For those who are focused on maximum profitability and are ready to invest time and money in management, short-term rentals in Dubai are a powerful tool. For investors who prefer passive income with minimal involvement, long-term rentals are still the optimal choice, despite certain disadvantages associated with the Ejari system, says Vyacheslav Kuznetsov, Head of Remote Acquisition Sales at Colife, a leading international rental and property management company in Dubai.
It is important for investors to evaluate not only the level of potential profit, but also operating costs, legal burden and time resources required for effective property management. Given the projected population growth, increased tourist flow and high demand for housing, the rental market in Dubai will continue to develop in 2025. And it remains attractive to those investors who want to buy housing here for rent.
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