Renting or Buying Property in Dubai

Renting or Buying Property in Dubai

Renting or Buying Property in Dubai

Renting VS Buying Property in Dubai

Dubai is a land of opportunities for everyone, but you’ll need a place to crash if you want to live there. Renting has always been a good option for the working class; however, if you are a successful professional moving to Dubai for work, buying may be a better option. But how does one make the decision between buying and renting in Dubai? If you’re in the same boat as many others and can’t decide between buying and renting, here’s a step-by-step guide to help you make an informed and profitable decision.

Many people who have been renting for years and saving money believe that Dubai’s real estate is in high demand and will continue to rise in value and yield better returns in the future. As a result, it is preferable to invest and reap good returns. Property value in Dubai generates comparable returns to property value in London. Yes, the market is growing despite the pandemic.

Buying has numerous advantages; even better, buying with cash is a better option than leasing and paying in installments. Freehold villas and apartments are available in desirable locations such as Jumeirah Village Circle, Mohammed Bin Rashid City, Ras Al Khor, and others. The money you spend on rent helps you stay in Dubai, but it doesn’t benefit you in the long run.

Due to both the financial crisis of 2009 and the pandemic situation in the last few years, buying in Dubai is currently better than before. Prices are more affordable now that the industry is regaining its footing, with the promise of better returns in the future. Mortgage rates are currently low, and fees are low; it’s also easier to get a loan and purchase property in off-plan developments. After an oversupply of properties in the market in 2014 and a real estate slowdown due to pandemics, the time is ripe to invest and earn a better return, as Dubai is regaining its footing and the market is now more stable and climbing.

Is it better to rent or buy property in Dubai?

If you can afford it, buy it.

You will need a 10–20% deposit and most banks will provide finance assuming your monthly salary covers your payments. Rent is eye wateringly expensive, it’s the same cost as a mortgage. So it’s either water down the drain or equity in the property.

Property prices go up and down with the price of Oil but in the long run, they are going up. I do fear oversupply, as they are always building new communities but I see the global business growing faster. Dubai is here to stay and will grow from 2m people to 4m in the next 10–15 years.

Many people come to Dubai to ‘try it for 2 years. 10% leave within 6 months, the majority stay 5–10+ years. Anybody still renting by year 5 knows they’ve thrown away hundreds of thousands of dollars.

On investments, I think Mark Twain said “Buy land, they are not building it anymore.

Renting in Dubai Has Its Drawbacks:

Because you can’t customize anything in a rental unit, no matter how much you pay, you have to compromise on the layout and furnishing.
The rental rate rises as the market improve day by day; this can be a significant disadvantage for those who are already on a tight budget.
Investing in a long-term rental unit is like putting money into a bottomless pit. If you add up all of the money you’ve spent on renting properties, you’ll see that you’ve gotten nothing in return.

The Advantages and Disadvantages of Buying in Dubai:

A property in the world’s hottest city is a profitable investment; you can live in style there, and when you sell it, you get double what you paid for it.
Unlike rental units, the property you purchase is yours to keep, which means you can change and remodel it as often as you want.
There are no long-term payments; if you buy in cash, you only pay the price and a few fees, whereas rental units deplete your income every month.

The Cons of Buying Real Estate in Dubai:

Buying a home is a significant investment, whether you pay cash, take out a mortgage, or even purchase an affordable off-plan property.
Aside from the actual cost, there are fees, time-consuming paperwork, and commissions and fees associated with hiring a real estate agent or company.

Even in a city like Dubai, there is always the risk of a stable and unstable market; you never know when a disaster will strike, and prices will fall; thus, buying a property is always a risk.

How to choose a property in Dubai

Assume you’re looking for investment opportunities in any of these areas of Dubai, particularly in light of Expo 2020, which is expected to boost the local real estate market. In that case, our firm can assist you with a wide range of properties in these and other parts of the city.

Our experts select properties based on the property’s desired characteristics as well as the possibility of obtaining the best possible returns on investment.

We examine all current changes in Dubai’s real estate sector, as well as projections for future growth, and we fully manage the processes of closing deals with sellers and processing documents for real estate ownership.


The emirate experienced a significant and painful decline in 2020-2021, followed by a quick recovery. The economic structure of many sectors of the economy, including real estate, has changed dramatically.

We’ll give you an overview of two different types:

The first is urban districts, which traditionally represent real estate investment returns and economic growth indicators. In the year 2020, their number decreased.


Let’s start with a few things to think about when deciding whether to rent or buy a home in the UAE. These will help you weigh the pros and cons of each option while keeping your future plans and current situation in mind.


Examine your short-term plans before devoting any more time to deciding whether to rent or buy a home in the UAE. Do you intend to stay in the UAE for at least the next five years? With all of the costs associated with purchasing a home, you must consider whether you will be in the UAE long enough to justify owning an apartment or villa.

If you’re only planning to stay for a few years or aren’t sure what you want to do yet, renting a property in the UAE might be a better option. It gives you more flexibility when it comes to moving to another country and is generally a good choice if you prefer to go with the flow and want more freedom. You can vacate the property and embark on your next adventure with just a three-month notice.


The cost of purchasing a home in Dubai is one of the most important factors to consider when making this decision. The decision to purchase property becomes somewhat easier for those who have a relatively stable job with a reliable and steady source of income. You will be in a better position to invest in property in the UAE if you know you will be able to make the down payment (minimum 20% for expats) and pay off the mortgage in monthly installments. The down payment, on the other hand, can be a substantial sum to pay up front. Here are some suggestions on how to save for a down payment in Dubai.

On some levels, this also applies to renting property in the United Arab Emirates. You take on the responsibility of a tenancy contract while considering your financial situation. But consider this: if you’re going to be paying rent on a monthly basis anyway, why not contribute to the purchase of your home? You will be a property owner in the UAE after 5 or 10 or even 25 years, which has some serious long-term benefits.

Even if you have to return to your home country or don’t end up living in the property you’ve purchased (due to a lack of space or a desire for a change of scenery), you can always rent it out and keep the monthly income if you’ve paid for it in full. You can use the rent to cover your monthly mortgage payments if you’ve taken out a mortgage to purchase your home. In any case, you will be the proud owner of an investment property in the United Arab Emirates, which is a huge accomplishment!


The level of control you desire over your property is another relatively obvious factor that may influence your decision. For example, owning a home in the UAE gives you more flexibility in terms of home modifications and customization. In contrast, even minor changes to a rented property may require a letter of authorization (NOC) from your landlord in order to obtain the necessary permissions.

Keep in mind that having more control over your property as the owner comes at a price. Landlords are typically responsible for an annual maintenance fee, service charges, and any repairs or modifications. The extent of your financial responsibility for the property is also determined by whether it is leased for 99 years or is owned outright.

The main list of investment areas.

downtown Dubai

The de facto center of the emirate is Downtown Dubai, formerly known as Downtown Burj Dubai.

It is near Business Bay “Dubai Manhattan” and the DIFC special economic zone on Sheikh Zayed Road. To the east is the Meydan racecourse, and to the west is the Jumeirah 1 district, which is a water sports center.

Throughout the year, the center is bustling with visitors. High-rise buildings and a selection of expensive villas coexist with a wide range of more affordable properties on the local market.

The composition of the population is extremely diverse. A large local population lives alongside the list of tourists and ex-pats of varying incomes. The district has many migrant workers and business representatives, especially its upper echelon.

Jebel Ali appeals to all kinds of demographics.

Jebel Ali Hills, Rove At The Park, Garden View Villas, Al Muntazah Complex, and Jebel Ali Industrial Area are the most popular property groups in the area.

Villas and townhouses with three or four bedrooms make up the majority of residential structures. The apartments come in either a 1-2 bedroom or a studio layout.

A standard 46-square-foot studio costs between $6,200 and $8,100 per month to rent. One-bedroom apartments start at $9,500, and two-bedroom apartments with 125 square feet start at $10,600.

Properties for sale are priced at $170,000 – $200,000. For studio apartments and one or two-bedroom apartments, the average cost can be around $326,700 and the average price per square meter. It costs around $300.


Here is how you can calculate the total upfront costs of a 1-bed flat for sale in Dubai Marina costing AED 1,004,000:

Required PaymentsAssociated Costs in AED
Down Payment (20%)200,800
Dubai Land Department Fee (4%)40,160
Real Estate Agent Fee (2%)20,080
Property Valuation fee (varies)2,500
Mortgage Registration Fee – 0.25% + 2902,800
Property Registration Fee4,000
Loan Establishment Fee (1%)*10,040

Total Upfront Costs: AED 280, 380


Here is how much a buyer can expect to pay for a 1-BHK apartment in Dubai Marina over the course of five years at a 20% interest rate. RERA service charges for Marina Diamond 1 in Dubai Marina are used to calculate the costs below. The average size of a one-bedroom apartment in Dubai Marina is 850 square feet for this scenario.

Required PaymentsAssociated Costs in AED
Mortgage Value (80%)803,200
EMI – 25 years tenure at 3.24%3,910
Total EMI over five years234,600
Annual RERA service charge for five years*62,815

Total cost of buying over five years: AED 297,415


As mentioned, the average cost to rent a 1-bed flat in this community is AED 66k. Based on this annual cost, here is how much a tenant can expect to pay in rent in five years:

Required PaymentsAssociated Costs in AED
Annual Rent66,000
Rent over five years330,000
Real Estate Broker Fee (5% one time fee)3,300
Annual Ejari Registration Fee (AED 215 for five years)1,075


The most important factor in deciding whether to rent or buy property in the UAE is how long you intend to stay in the country. If you’re one of the many who’ve come to call it home, crunch the numbers, do your due diligence, review market conditions, and invest in the lucrative UAE real estate market. If, on the other hand, you have no idea where you’ll be next year and want the freedom to relocate, simply rent a beautiful home in the UAE until you know what’s in store.

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John Hopkins is Editor at Admire, his One of the original CB crew, John joined the team back in 2013 after moving from her role as a staff writer on Design World. Since then he's written regularly for other creative publications.

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