A Guide to Short Term Lets in Dubai

With residential rents currently in decline, many home-owners are looking towards the short-term letting market to maximise returns. Here we examine both the legal and practical context in which short term lettings operate in Dubai.

What is a short term let?

Short term lets, also known as a short term rental, are a type of accommodation that is rented out for a short period, typically ranging from a few days to several months. In Dubai, they are particularly popular among tourists, business travellers, and individuals relocating to the city for a temporary period. Unlike traditional long-term rentals, which often require a lease agreement of a year or more, short term lets offer flexibility for both the property owner and the tenant.

Short term let apartments in Dubai can range from luxury penthouses to studio flats. Property owners can benefit from higher rental yields compared to long-term lets, while tenants enjoy the comfort and amenities of a home away from home without long-term commitment. Proper short term let management ensures that the property is well-maintained and that guests have a positive experience, further enhancing the attractiveness of this rental option.

Regulations and the rise of short term lets in Dubai

The accessibility of online short-term letting platforms like Airbnb has created a significant market for holiday lets in Dubai. But initially the industry was largely unregulated, and work needed to be done by the operators and the authorities to create a legal framework for the benefit of all stakeholders. The Dubai Department of Tourism and Commerce Marketing (“DTCM”) was appointed to oversee the introduction and implementation of such regulations, and they worked closely with industry players like Airbnb to put in place a system to promote transparency, safety and standardisation.

Initially a home-owner could only rent out their unit on a short term let basis through a licensed corporate operator (Decree 41 of 2013). Then in 2016 the regulations were amended to allow individual home-owners to become licensed operators and to rent out their properties directly. This change was motivated by a wish to boost tourism by providing a long overdue alternative to the traditional hotel offering in Dubai.

Note that by registering as an individual operator of a short term let, you agree to be bound by the DTCM regulations that govern the short-term letting market. So, you need to familiarise yourself with those regulations and ensure that you comply with the obligations imposed on you at all times, to avoid exposing yourself to fines etc. for breach. These obligations include:

• Taking out insurance cover for the guests, the property and the building
• Ensuring the unit is let as a whole (separate room letting is not allowed)
• Coordinating with the building Owners Association
• Taking and uploading to the DTCM all guest details/ passport copies in advance of lettings
• Checking-in/ checking-out guests
• Providing a 24/7 emergency number
• Maintaining the units to the minimum required standards
• Keeping accounts
• Making payment of the various fees due to the DTCM.

Navigating registration for short term lets in Dubai

So how do you go about registering yourself as a short term let operator in Dubai? The first step is to visit the DTCM website and complete the detailed online application form, providing information about you and about the property you wish to rent out.

You need to prove ownership of the property (by uploading the title deed/ DEWA bills) and prove your identity (by uploading your passport). You also need to designate the property as being either ‘standard’ or ‘deluxe’, by reference to a list of relevant factors.

Once your application has been approved, you must pay the registration fees (currently totalling in the region of AED 2,000) before collecting your licence. Additional fees are payable for each property you want to register for short term letting. These include:

Whilst the most recent regulations allow for individuals to register as operators, many owners still prefer to retain corporate licensed operators to handle short term lettings and assume responsibility for compliance with the DTCM regulations. Corporate operators are not only licensed by the DTCM but also by the Dubai Department of Economic Development.

They are usually more experienced in this field and have the personnel and resources necessary to be able to furnish and maintain your unit to the requisite standards, deal with the mechanics of daily guest check in / check out, upload guest information, replenish and refresh units immediately after each stay and ensure that all accounts are kept up to date and payments made on time. Corporate operators usually charge a percentage of income for their services.

To summarise, Dubai's short term rental market is booming. No matter the competition, however, it's essential to comply with regulations by entrusting your property to a licensed operator. 

Whether you're an individual short term let owner, or seeking the expertise of a reputable corporate team like haus & haus, navigating these regulations ensures legal and successful short term letting.

Explore Dubai's vibrant market and unlock your property's full rental potential with haus & haus. Contact us now to discover how our experts can optimise your short term let property management

Emma Campbell on +971 52 242 4497, emma.c@hausandhaus.com