As the New Year approaches, Dubai’s property investors and landlords who have relied on short-term rentals are basking in the glow of rich rewards, with year-over-year rate increases soaring to unprecedented heights, reaching up to 50%, according to market sources.

Throughout December, short-term accommodation reservations in Dubai have experienced a surge, particularly for luxury properties. A significant portion of these bookings spans an entire week, with average daily rental prices for apartments ranging from Dh1,500 to Dh2,500, contingent on factors such as location and demand. The current surge is predominantly noticeable in the upper echelons of luxury accommodations, where there’s a growing demand to lease entire villas.

Surprisingly, this surge might not be over, as last-minute reservations are still anticipated until the first weekend of January 2024, promising another potential spike in rate increases.

Listings on the Palm are reflecting daily rates of Dh4,500 and above, while upscale two-bedroom options in Downtown are nearing Dh2,500.

This December has defied historical trends, where early December typically witnesses a slowdown as tourists avoid travel in the weeks leading up to New Year’s Eve. Gregory Lewis, founder and Director at Dubai-based holiday home operator AirDXB, notes, “Early December this year went against the grain, and we saw rates increase up to 50% higher than the same period in previous years.”

The exceptional demand in December was fueled by the influx of visitors for COP28, presenting a massive opportunity for real estate investors. Many seized the moment by adding their recently acquired properties to Dubai’s short-term rental inventory, capitalizing on the unexpected surge.

Looking ahead, Dubai Creek Harbour is emerging as a noteworthy contender for short-term rentals. While The Palm, Dubai Marina, Downtown, and Business Bay remain popular choices, Dubai Creek Harbour is gaining traction due to its new and modern complexes, proximity to the airport and Downtown Dubai, and affordability compared to other expat-dense areas.

“We see a lot of inquiries about Dubai Creek, particularly as it’s home to new and modern complexes that perform well on listing platforms,” explains Lewis. “The location is ideal for business travelers, new residents settling in Dubai, and those seeking a budget-friendly option. It’s a specific market, but it works.”

Dubai’s dynamic short-stay rental market is experiencing a paradigm shift, with unprecedented demand reshaping the landscape as we head into the New Year.

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