The number of Airbnb listings in Dubai has increased dramatically over the past three years and is currently estimated to be between 25,000 and 30,000 and is expected to grow further in 2024. This trend not only provides investment opportunities, but also showcases Dubai's appeal as a global tourism and business center.

Since 2016, Dubai has introduced a legal framework for short-term rentals, which has resulted in a fully regulated market that has become another stable and lucrative source of income for UAE nationals and expatriate landlords.

Many new owners are choosing to convert their units to short-term rentals when they first enter the Dubai real estate market, while some existing owners are selling their properties to new buyers in the market and continuing to use their new properties for short-term rentals. This flexibility not only improves asset utilization, but also opens up more revenue opportunities for landlords.

Short-term rentals are attractive because they provide landlords with complete asset freedom. Compared to long-term leases, short-term leases allow landlords to maximize revenue by adjusting rents and strategies based on market demand. Based on data from the past two to five years, the short-term rental market has averaged around 20% higher returns than long-term rentals, which is one of the key factors attracting investors.

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The potential of the Dubai market is immense, especially on the back of continued growth in the tourism industry. 2023 saw a 19% year-on-year increase in the number of international visitors to Dubai, providing a plentiful source of clientele for landlords. Earlier this year, Dubai even received more than 5 million overnight visitors, an 11% increase year-on-year, demonstrating the market's healthy growth momentum.

However, it is vital for investors to understand the details of the market. For example, while nightly rates are higher in areas such as Dubai Marina, Jumeirah Beach Residence and The Palm Jumeirah, the high cost of property also means returns can be relatively low. Areas such as Jumeirah Lake Towers (JLT) and Jumeirah Village Circle (JVC) are currently considered to offer higher returns on investment, and although prices in these areas are also rising, they remain attractive to investors willing to put in the effort.

The diversity of the Dubai market further enhances the appeal of short-term rentals. From families seeking the privacy of a villa to travelers who like to experience city life, there is strong demand for different types of properties from different demographics. With over 700 properties under management, we are seeing healthy occupancy rates across our various locations.

Emerging trends include people opting for longer term rentals and groups of friends choosing larger apartments for group vacations.Developments in areas such as Barsha South, Meydan and Dubai Creek are among the hot spots to watch this year.