Dubai has an eclectic mix of people looking for accommodation: expats seeking long-term rentals, professionals taking a gander at short-term rentals, tourists staying at hotel apartments…there’s something for everyone in this busy metropolis. Even in terms of how to pay rent, there are several options, single rent cheques, multiple rent cheques and so on. When the choice is this wide, there is bound to be some amount of confusion as to what is the best option for you. Let’s examine the pros and cons of long and short-term rentals in Dubai and analyse the benefits of paying rent in multiple cheques in Dubai.
Long-Term vs Short-term rentals in Dubai
Some of us like to plan ahead and make informed decisions about our long-term choices while some of us live on impulse buys and spontaneous decisions. It’s therefore only natural that Dubai has identified the need to cater to these varied interests when it comes to renting properties in Dubai.
Short-term rentals in Dubai
Short-term rentals in Dubai are properties leased for short amounts of time, offering, weekly and monthly options for rent payments. These are largely for tourists and business professional visiting the city, looking for a homely place to stay in after their busy days of sightseeing or working. Fully-furnished apartments, holiday homes and hotel apartments in Dubai are usually available for rent on a short-term basis.
They usually include utility bills, cleaning charges and parking spaces. This makes it ideal for the aforementioned population, who are not in the city long enough to make a long-term commitment but want the comfort of a home. These properties are however far more expensive than long-term rentals, and rents are subject to frequent changes. Renting short-term in Dubai are also favoured by those looking for an option to pay rent monthly, as the initial costs for long-term rentals are significantly higher, especially if landlords demand a single rent cheque.
Benefits of Short-term rentals in Dubai
- Affords residents the flexibility of moving from one place to the other
- No overhead costs
- Ready to move in, furniture and fittings already taken care of
Things to Consider with Short-term rentals in Dubai
- Lack of Stability
- Higher costs
- Limited options
Long-term Rentals in Dubai
Long-term rentals in Dubai are predictably properties rented for a longer period of time, usually on a yearly basis. They come with an annual tenancy contract recognised by RERA, offering a stable home for you to live in with rents locked in for the year. These are usually unfurnished and you have to pay for all utilities separately. With long-term rentals in Dubai, there are some overhead costs to also consider, including security deposits, agency fees and furnishing costs.
Rents are paid as post-dated cheques on a quarterly, bi-annual or yearly basis, and if you default on your contract you have to pay all outstanding amounts, limiting your flexibility to move homes frequently.
Benefits of Long-term rentals in Dubai
- Rents locked in for a year
- Stability in term of your living arrangements and financial output for the year
- A personal space for you to customise
Things to Consider with Long-term Rentals in Dubai
- No Flexibility
- Overhead costs are high
- Most long-term rentals in Dubai are not ready to move in and will need investment from you for furniture
Yearly Vs Monthly Rent in Dubai
The general practice in Dubai when it comes to long-term rentals for villas and apartments in Dubai has been to pay on a yearly basis, with a single rent cheque handed to the landlord upon commencement of the contract. This is however far from the norm for the large expat population in the city. British expats, for instance, are used to paying rent on a monthly basis and are often overwhelmed by the large amounts they need to commit to when looking for properties to rent in Dubai. This has resulted in quite a few people looking at renting short-term in Dubai, simply to avoid the huge initial investments for renting an apartment in Dubai.
Things have however changed now, with the erstwhile norm of a single cheque payment replaced by a quarterly arrangement in most cases. Some landlords are even offering the option to pay rent monthly in Dubai, but these are fairly rare. The multiple rent cheque option affords more stability than short-term rentals, the initial costs also reduce significantly when the payments are split over multiple cheques. Bear in mind though, with this option, you are still tied to the fixed term contract, so you cannot just leave the property as you please.
The costs for properties with multiple rent cheques in Dubai are predictably higher than the single cheque option, but this is overshadowed by the fact that the initial expenses are considerably lower.
To put things in perspective, let’s look at some of the initial expenses when it comes to renting a one bedroom apartment in Dubai Marina, where average rents are currently at AED 95k:
- Security Deposit (usually equivalent to one month’s rent): AED 8000
- Agency Fees (2-5% of the yearly rent): AED 4750
- DEWA Deposit: AED 2000
- DEWA connection Fees: AED 100
- Housing Fees (5% of annual rent spread over your DEWA bills for the year): AED 4750
- Ejari Fees: AED 195 0r AED 585 depending on whether you choose online or offline modes. You can pay fees with Ejari online in Dubai.
When you combine all these costs along with the furnishing, internet connectivity and other peripheral expenses, this can go well over AED 120,000, if you are paying rent yearly in Dubai! If that same payment is changed to multiple rent cheques spread over quarterly payments, the expenses will be less than half this amount.
Hotel apartments in Dubai Marina, start at AED 9000 per month, which is obviously more expensive in the long run, but makes things convenient for first-timer renters in the city.
Seeing the exorbitant costs of renting with a single cheque in Dubai, it’s easy to see why a large number of people resort to taking loans when they move to Dubai. Even if the costs were to go up by a few thousands when you opt for the multiple rent cheque option, it will still not be such a strain on your finances. That said, if you do have the money saved up, a single rent cheque is still the most cost-effective option.
Like most choices, the best ways to rent in Dubai also depends on your needs and requirements. If you are looking for short-term rentals with a hassle-free arrangement and don’t mind the instability and higher rents, then a fully-furnished serviced apartment might be the best option for you. If you are looking to settle down and be here for a long period, think along the lines of a fixed term contract, with the option to pay rent in multiple cheques. For those of you who have a steady savings account and don’t mind the initial hit of a single cheque, choose that option so you end up saving in the long-term.
Finding the perfect home in Dubai is not simple. It requires extensive research, several visits and above all, lots of planning. We at Bayut are committed to helping you find the right property for your needs, so be sure to subscribe to the UAE’s best property blog to stay up to date on all the latest trends and tips when it comes to properties in Dubai and the rest of the UAE.