Dubai is a notable and remarkable tourist destination for the travelers and business community from all over the world. People in Dubai have got on the rising tide of short-term rentals due to the 80% to 90% occupancy rates. Besides, the returns have reached at the top of the revenues limit in this culturally vibrant and diverse city.
It goes without saying that starting a short-term rental business in Dubai will not introduce you to the loss or compensations. You will join a community of short-term rental accommodations who are reaping the benefits of the tourist industry of Dubai – backbone of UAE’s Gross Domestic Product (GDP).
Apart from real estate developments, many people in UAE are looking for affordable yet attractive passive income sources for earning higher than expected returns.
However, Short-term Rentals in Dubai are not free from any local laws and regulations. But, worry not!!! We’re going to provide you with a detailed yet comprehensive guide on short-term rentals and regulations. Moreover, we will share details about the best real estate property management company in Dubai.
So, let’s dive into this exciting discussion!
Table of Contents
Short-Term Rentals in Dubai
Short-Term rentals in Dubai are referred to as fully furnished holiday homes for rent for ninety days or less. The licensee or renter gets payment with respect to days, weeks or months. The
Short-term letting includes only the entire homes as providing the short-let accommodations. The partial renting out for short stays is not considered as a holiday home.
Short-Term rental market remains undervalued, attracting many businessmen globally towards it. Investors are throwing their money into this business in anticipation of higher returns in future. An informed investor finds great opportunity in this business in Dubai due to a various reasons. Let’s discuss all of them!
Short-Term Let Market in Dubai - A Profitable Business
According to a recent report by AirDXB, there’s a lot of room for new property investors in real estate to start a venture as a short-term rental. The report explains that the higher rates for the long-term letting has created a renewed demand for the holiday homes in the centers of Dubai.
Although many investors have switched towards the long-term rentals in UAE, the small investors can initiate their business as holiday homes because there’s low supply of short-term rental accommodations. In short, a massive opportunity is awaiting the new investors to list their business online booking platforms like Airbnb, Booking.com and AirDXB.
Analysing the same report, we can observe that the occupancy rate has reached 90% in this gulf state. Moreover, the revenues are bound to push further as a result of more tourists visiting this stunning city in the world. According to Lewis, the Founder of AirDXB, the future of short-term letting is very optimistic and booming in 2023. So, NOW is the best time to invest in short-term rentals.
Before this, let’s learn about short-term rental regulations in Dubai by the Department of Tourism and Commerce Marketing (DTCM).
Curious to see how much you could earn on Airbnb? Schedule a free, no-strings-attached consultation with our Airbnb Management Dubai team to uncover your property’s revenue potential.
Department of Tourism and Commerce Marketing
Department of Tourism and Commerce Marketing is a government organisation responsible for promoting tourism and commercial activities in Dubai. The primary goal is to facilitate the tourists, businessmen and commercial businesses for the sake of attracting investments and tourists.
With detailed information available on the website, the department provides immense information about Dubai’s tourist’s spots information, residence information, business promotion policies, ecosystem of Dubai for investors and opportunities for opening new avenues for the local and foreign investors.
DTCM also requires details of each guest from the licensee. Moreover, this government organisation in Dubai is also responsible for resolving any disputes between any of the parties.
Short-Term Rental Regulations in Dubai
In Holiday Home Activity Operations, the rental regulations for short-term stays have been defined.
The rules have been categorised as:
- Internal Rules for Guests
- Holiday Home Check-in and Check-out
- Obligations for Residential or Complex Management
Some key regulations are as follows:
- Inform the DTSM:
The renters must inform the DTCM about the guests and maintain a proper record of each guest. DTCM may demand this record anytime from the renters in Dubai. DTCM has also set the charges for night stays which are available on the document of regulations.
So, record keeping is necessary for maintaining transparent records or to resolve any dispute fairly. Conversely, DTCM requires the listing of entire fully-furnished homes instead of dedicated rooms for short-term rentals.
- Internal Rules for the Guests
- The internal rules for the guests require the guests to avoid any damage to the property, furniture or other belongings at the holiday homes.
- Residential Amenities must be respected.
- Noise should be avoided to cause no disturbance to the neighbourhood.
- The visitors are required to stay before 12AM and cannot stay after this time until 8AM. In other words, the visitors are not allowed in holiday homes between 12AM and 8AM.
- Children under 14 years should be cared and attended all the time
- Vehicle Parking Rules must be followed strictly.
- Ensure cleanliness of the place and refrain from smoking in non-smoking areas.
- In case of any dispute, the guests are supposed to inform the license as soon as possible
- Holiday Home Check-in and Check-out
- The licensee must inform the guest about the terms and conditions along with internal rules.
- The renter must provide information about the new guest on the Holiday Home System within the three hours of the guest’s check-in at the unit.
- The renter should provide an alternate unit of the same attributes to the guest if he discovers any damage to the unit.
- Obligations For Residential or Complex Management
- The residential units must ensure smooth entry of the licensee and the guests to the building.
- The residential management should inform DTCM in case of any violation or breach of conduct, rules and obligations.
- The building management may receive a copy of the guest’s passport photos and identity card.
Addressing the Complaints
- Any complaints received against the guests and licensee will be mitigated by the Department of Tourism and Commerce Marketing. DTCM will not review a dispute if it doesn’t come under its jurisdiction. Similarly, if parties refuse to accept the final decision of DTCM, they can go to a relevant judiciary body in Dubai for the resolution of their disputes.
- DTCM will adopt an automatic resolution if it fails to receive any response from either of the parties.
- The concerned parties (guest or licensee) will be informed via a written letter to adhere to the decision.
Terms and Conditions for the Guests
The licensee must provide instructions on the terms & conditions to the guests. So, it's essential to have a look at these terms and conditions to avoid any disputes with guests.
- Total number of visitors allowed is four people at a time. For master bedrooms, it is two adults and two children of less than 14 years. For additional room, two adults and one child under 14 years of age is allowed in the premises.
- Complete information on licensee’s contact details, payments and checking times.
- Information about the use of property premises.
Penalty for Violation of Short-Term Rentals in Dubai
Short-term holiday rental regulations should not be infringed by guests. If guests violate any of the above regulations, the dispute will be resolved by the Department of Tourism and Commerce Market (DTCM). If there’s any unlicensed short-term rental operational in Dubai, the DTCM will charge the owner by AED 5000 for getting illegal rent.
On the other hand, the registration fee of starting a letting business in Dubai is AED 2000 that is less than the penalty fee. So, it’s ideal to pay a registration fee to avoid a strict penalty in Dubai.
Subletting of Short-term Lets in Dubai
Short-term subletting is legal in Dubai and no penalty will be charged for opting this. However, the subletting requires the following documents:
- Leasing or Sub-Leasing Agreement
- Consent or NOC from Owner using the DTCM template.
- Owner’s Passport or Emirates Identity Card
Tourism Dirham as Short-Term Rental Levy
DTSM charges a tourism dirham levy on the guests at Short-term lets. Department of Trade and Commerce Marketing (DTCM) uses this income to promote and forward tourism in Dubai.
Is Houst Available in Dubai?
Certainly, Houst services are available in Dubai as well. You can enjoy the most professional hosting and property management services in Houst. The ultra-modern and hi-tech hosting services with the help of tech enthusiasts at Houst make your business profitable and desirable.
How Does Houst Operate?
Houst offers its impeccable services at multiple levels and fronts for managing your real estate business, particularly short term-rentals or holiday homes in Dubai. They offer the best hosting, listing and holiday homes management services in Dubai.
Sustainable Hosting services
Houst offers the best sustainable hosting services in Dubai where you can get access to carbon-free housekeeping products and energy-efficient property management services. Moreover, eco-friendly amenities are the ultimate goal of this leading property management company in UAE.
Property Insurance Coverage
Houst provides listing of your property on all property insurance platforms. It ensures that your business is properly covered against any damage to the property and amenities. The guests are also insured under the insurance plan for the occupancy period.
On the other hand, you can receive a guaranteed Aircover for all your listed properties in Dubai for short-term lets. It will save you thousands of dollars if everything at your property is insured and covered. Houst ensures you receive the best insurance plan in Dubai for your Holiday homes.
How Can a Licensee Track his Letting Business with Houst?
Don’t Worry! Houst offers a transparent, interactive and real-time tracking of your holiday homes. As a result, you can view insights about the guests, check-in and check-out time, daily, monthly or annual revenues.
Moreover, the licensee can view the updates on record keeping. The records on property maintenance are fully accessible on the dashboards. Similarly, the renter can get updates about the latest information about their business via this top-notch dashboard.
Can Houst Provide Hosting Services to The Guests?
Houst arranges the most professional and amiable hosting services to the guests. The dedicated team member is fully aware of the internal rules for the guests, building rules, DTCM rules and payment procedures. As a result, they can give clear instructions to the guests for behaving according to the rules to avoid any dispute.
Why Should I Partner with Houst?
We’re best in managing short let businesses in the UAE. With skilled and expert staff, we are a team of tech geeks who indulge themselves in the listing and management of your short lets. No other short-let management company in UAE that will offer all-encompassing services at the minimal fee.
Houst management team takes care of your business to make additional revenues for you. Growing your business is the commitment of Houst. Therefore, you can rely on Houst’s management services without any reluctance. Moreover, we provide legal management services to comply with the local laws and regulations. So, there’s no risk in handing over your holiday homes to the best short-let management company in Dubai.
Going forward, we conclude that Dubai is home to tourists and business events. After the Dubai Expo 2020, the short-term rental business is flourishing as tourists are coming in more and more. With a thriving tourist market, businesses are also growing in the UAE.
The long-term rentals are also increasing due to the higher rates and maximum profits. In 2023, there’s a great opportunity for Holiday Homes in Dubai. If you start your short-let business today, tomorrow you can make your own luck in this business. So, you don’t need to overthink because if you don’t want to go through all the pain of listing your business, you can rely on the authentic short-let management services of Houst.
Houst offers the exceptional and professional management services to abide by the local regulations. The process of registering and listing your business becomes smoother and convenient with the professionals at Houst. So, get in touch with us right now!