Rents for apartments and villas in Dubai are expected to stabilise by the end of this year, having doubled since the Covid pandemic, with more supply expected, analysts say.
“By the end of 2026, we believe rental growth will stop compared to 2025 … and that’s mainly due to the amount of supply that is coming in, as there are many projects that are expected to come online this year,” Haider Tuaima, managing director and head of real estate research at ValuStrat, told The National.
Rise in supply is also expected put downward pressure on rents in areas such as Business Bay, Jumeirah Village Circle and Jumeirah Lakes Towers, he said. "These areas might see some pressure and it very much depends on supply and handovers," he added.
"If you get too many handovers and the tenants will have a lot to choose from, landlords cannot increase the rents and they might also offer discounts."
Dubai rents have surged since the pandemic on the back of government initiatives such as residency permits for retired and remote workers, the expansion of the 10-year golden visa programme and overall growth in the UAE’s economy.
Population growth in Dubai and Abu Dhabi, alongside an influx of a large number of high-net-worth individuals to the UAE, have pushed up property prices and rents owing to strong demand.
Rents are expected to moderate this year with "softening in some locations as more supply continues to enter the market and tenants have more choice", said Rachael Kennerley, director of Middle East research at consultancy Savills. "However, areas in high demand, especially villa communities where the supply constraints are expected to persist, may see stable to higher rents."
About 170,000 units are expected to be completed in 2026 with nearly 88 per cent of those being apartments, Savills said. It is not known how many are expected to be handed over to customers.
Surge in tenancy contracts
Dubai’s rental sector recorded strong growth in 2025, with tenancy contracts rising in volume and value for the year amid higher demand from tenants, government data shows.
Registered tenancy contracts rose 6 per cent in volume on an annual basis to 1.38 million contracts, while the value of contracts surged 17 per cent to Dh126.4 billion ($34.4 billion), Dubai Media office said in a statement on Monday, quoting the Dubai Land Department.
The number of new tenancy contracts also jumped by 10 per cent to more than 513,000, “reflecting Dubai’s strong appeal as a destination to live and work", the statement added. Renewed tenancy contracts, meanwhile, increased by 3 per cent to more than 514,000.
“This balanced rental performance is clearly aligned with the objectives of the Dubai Economic Agenda D33, which focuses on enhancing quality of life and reinforcing Dubai’s position as a global destination to live, work and invest, alongside the Dubai Real Estate Sector Strategy 2033, which aims to establish a sustainable market based on a balance between ownership and renting, clear regulatory frameworks and an enhanced customer experience.”
The Dubai Real Estate Sector Strategy 2033 aims to double the real estate sector’s contribution to Dubai’s gross domestic product to about Dh73 billion and growing real estate transactions by 70 per cent to Dh1 trillion.
Dubai also recorded a growth in real estate project completions for the year, with the development activity continuing in the emirate as demand remains strong from the buyers. The total number of completed projects in Dubai rose to 124, up 7 per cent increase when compared to the previous year, with a total value of Dh27.5 billion, an increase of 23 per cent.
Projects under construction, meanwhile, increased by 25 per cent to 937, data shows.
