- What are short-term rental properties?
- Benefits of short-term rentals
- Short-term rental contracts in Dubai
- What tenants should know about short-term rentals
- Popular areas for short-term rental properties
More and more homeowners are choosing to rent their property on a short-term basis instead of the usual annual lease. Short-term rental contracts in Dubai have many benefits for owners, providing more flexibility and the opportunity to increase their returns. Today, MyBayut presents a quick guide to leasing properties on a short-term basis in Dubai. Discover more about the necessary permits, how to go about short-term rentals in Dubai and the best locations for finding such properties.
What does short-term rent mean?
Short-term rental properties in Dubai are typically rented out on a monthly, weekly or even daily basis. These properties are mostly furnished and include utilities such as water, electricity and internet.
Properties rented on a short-term basis are referred to as ‘Holiday Homes’ and could include apartments in a mixed-use or residential building or independent villas. However, it’s important to note that the entire property must be rented out for short-term rentals, not just part of the unit.
Please remember that as per the Dubai Department of Economy and Tourism, hotel and hotel apartment buildings are NOT permitted to host holiday homes.
Also, not all residential villas can be used for short-term rentals. Villas that can be used as holiday homes must be in a gated compound comprising a minimum of four units. DET can consider commercial villas located on main roads as holiday homes.
What are the benefits of short-term rental contracts in Dubai?
Both landlords and tenants enjoy certain benefits with short-term rental contracts in Dubai. With short-term rent in Dubai, landlords have the flexibility to lease their property for the duration that they would like. Moreover, landlords can also increase their rental returns with short-term rental properties by allowing them to adjust the price depending on the time of the year and demand.
However, tenants living in short-term rental properties in Dubai also benefit from having a fully-furnished property with all the utilities, removing the hassle and cost of setting up a property. Tenants can find out more about whether they should opt for short-term or long-term rentals in Dubai with our in-depth guide.
How do short-term rental contracts in Dubai work?
Unlike long-term rentals, short-term rental contracts do not have to be registered in the Ejari system. Instead, short-term rentals are regulated by the Department of Economy and Tourism (DET).
Thus, properties that are to be rented out on a short-term basis require a permit and approval from the DET before being leased to tenants. Homeowners in Dubai, who want a permit for a short-term rental property, can either register themselves as an individual operator on the DET website or employ the services of licensed operators, who will take care of the process for them.
It’s important to note that tenants can also sub-lease their property on a short-term basis, provided they have a no-objection certificate from the property owner.
Registration and permit
The first step for individual operators, such as homeowners or tenants, is to register themselves on the Department of Economy and Tourism website. They can do so through the Holiday Homes section and register as a ‘Homeowner.’
To register, individual operators must upload copies of their Emirates ID or passport and fill out the required information. The registration fee as an individual operator is AED 1,500 (+ AED 10 knowledge fee + AED 10 innovation fee).
Once a homeowner is registered, they can apply for the necessary permit for their property. Homeowners should remember that they can apply for permits for eight properties (maximum). If they wish to acquire permits for more properties, they will be required to obtain a trade licence and register as a professional operator.
When applying for a DET permit for short-term rentals, homeowners will be required to upload the title deed of the property and the DEWA bill under the owner’s name.
However, if a tenant is subletting a property on a short-term basis, they will be required to upload additional documents, including:
- The lease agreement, which also mentions the sub-leasing clause
- NOC from the owner, which must be in the DTCM template
- Owner’s passport or Emirates ID
The permit fees for short-term rental apartments and villas are as follows:
- Studio or 1-bedroom: AED 370
- 2-bedroom: AED 670
- 3-bedroom: AED 970
- 4-bedroom and above: AED 1,270
- The permit for short-term rent in Dubai is valid for one year and must be renewed annually.
- A holiday homes permit is issued for 3 months to 12 months (maximum).
- Permit fees are irrespective of the validity period.
Operating your short-term rental property in Dubai
Once the Department of Economy and Tourism has issued the short-term rental permit in Dubai, homeowners can start advertising their property on Bayut, allowing guests to filter between properties available for daily, weekly and monthly rental. Bear in mind that tenants must rent out the entire unit, and the homeowner cannot occupy part of the property simultaneously.
According to DET, operators for short-term rental properties in Dubai should have insurance that covers risks posed to guests, the property or the building. DET also recommends informing the building management beforehand about the rental operations for short-term rental apartments in Dubai.
It’s important to note that there is no specific template for a short-term rental contract provided by the DET between the operator and the guest. However, operators must register all guests who check in to the property onto the DTCM system.
When guests check in to the property, the operator must upload either a copy of the National ID (for GCC Citizens) or the passport (for all other nationalities) for all the guests.
Tourism Dirham
One of the taxes charged in the UAE, the Tourism Dirham, is levied on guests by hotels, hotel apartments and short-term rental properties in Dubai. Tourism Dirham is charged to help develop the trade and tourism sector in the emirate.
Operators of properties on short-term lease in Dubai will also collect Tourism Dirham from their guests on DCTCM’s behalf. The total Tourism Dirham amount collected for each month must be paid to the Dubai Corporation for Tourism and Commerce Marketing by the 16th of the following month.
HOW IS THE TOURISM DIRHAM CALCULATED FOR SHORT-TERM RENTAL PROPERTIES?
Tourism Dirham is charged per night per room occupied for short-term rentals in Dubai. The amount charged for Tourism Dirham depends on the category of the property: standard or deluxe. The classification of short-term rental properties in Dubai is done when applying for the DTCM permit.
The Tourism Dirham fee for standard or deluxe properties (per night per room) is as follows:
- Standard: AED 10
- Deluxe: AED 15
The Tourism Dirham fee for a guest’s stay will be calculated when the operator checks out the guest through the DTCM system. The operator must then present the Tourism Dirham fee as a separate charge when presenting the bill or invoice to the guest.
It’s important to note that Tourism Dirham is only charged for the first 30 consecutive days of the guest’s stay.
What should tenants know about short-term leases in Dubai?
Before entering a short-term rental contract in Dubai, there are certain points that tenants or guests should be aware of:
- The rental price advertised for short-term apartments and villas typically does not include additional charges such as VAT, Tourism Dirham and refundable deposits.
- On the other hand, the rental price does include utilities such as internet, water and electricity and can consist of other benefits such as housekeeping and in-house maintenance.
- Many short-term rental contracts in Dubai require guests to stay for a minimum number of nights.
Which areas are popular for short-term rental properties in Dubai?
Since short-term rentals in Dubai are typically sought after by tourists and business travellers, such properties are usually found in centrally-located areas close to the city’s landmarks and leisure and commercial hubs.
Most apartments for short-term rent in Dubai are typically located in popular areas. For instance, there are many options for short-term rentals in Dubai Marina, Jumeirah Beach Residence, Downtown Dubai and Business Bay. These areas boast world-class attractions, easy access to the city’s landmarks and stylish properties. There are many apartments for monthly rent in Discovery Gardens, too, with shopping destinations such as Ibn Battuta Mall and Festival Plaza nearby.
Those who look at villas on short-term rentals in Dubai will typically find such properties in the iconic destination of Palm Jumeirah, which offers luxury beachfront villas close to waterparks and resorts. Short-term villas rentals in Dubai can also be found in the neighbourhood of Jumeirah Village Circle, which has affordable options that are a short distance from hubs like Dubai Marina and JBR and attractions like IMG Worlds of Adventure and Global Village.
I need more information on short-term leases. Who should I contact?
If you have any further questions on short-term accommodation in Dubai, you can contact Dubai Economy and Tourism at 600-555-559.
And that concludes our guide on short-term rental contracts in Dubai! If you’d like more information on leasing holiday homes in Dubai, look at our Expert Advice, where the Co-founder of Driven Holiday Homes gives further insight into the process.
If you’re a business traveller in the city for a longer stay or a family looking for a place to stay while they find their dream home, you can browse our listings for apartments in Dubai for monthly rent, where prices start as low as AED 2,490 per month, as per current listings. For tourists who want privacy and comfort in their accommodation, Bayut has many options for studio apartments for weekly rent in Dubai.
Stay tuned to MyBayut for more articles on short-term rentals in Dubai!
