Estate agent Charlie Shetliffe has worked in Dubai for five years and has never seen the rental market this busy.
Clients are eager to snap up townhouses and villas – particularly in the city's desert suburbs – as quickly as possible.
The legacy of remote working is a major factor, with many professionals now splitting their working week between the office and home.
Mr Shetliffe has seen the cost of renting rise amid the economic recovery, which the latest industry reports confirm.
We don’t even need to advertise properties online anymore because there’s so many people already on the waiting list as soon as something becomes available
Charlie Shetliffe,
Haus and Haus
“I’ve never seen the market like this at any stage of the past five years,” said Mr Shetliffe, senior leasing consultant with Haus and Haus.
“We don’t even need to advertise the properties online anymore because there’s so many people already on the waiting list ready to go as soon as something becomes available.”
The National spent an afternoon with Mr Shetliffe as he showed clients around properties in Dubai’s Jumeirah Golf Estates.
A typical two-bedroom villa that cost Dh160,000 ($43,500) just six months ago here now fetches north of Dh200,000, he said.
A larger four-bedroom villa will now set you back Dh320,000, when six months ago you would have expected to pay Dh270,000.
“We’ve seen a huge increase in demand for villas and villa communities compared to apartments recently,” he said.
“This is largely down to people working from home during the pandemic who wanted to have extra space," Mr Shetliffe said.
“Outdoor space, like a garden, is more in demand than ever as well, because people were feeling cramped spending so much time in their apartments.”
While the increase in the cost of renting in Dubai is good news for landlords, it is obviously less so for those who rent.
Mr Shetliffe admitted there are challenges trying to find a happy medium between landlords trying to make the most of the boom in the market and would-be tenants hoping to find a new home on a limited budget.
“There’s no doubt it’s a landlord’s market right now but they still have to make sure they are not too greedy and end up asking for too much,” said Mr Shetliffe.
“At the end of the day, tenants still have a budget they cannot exert beyond a certain point.”
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Suburbs vs town: Apartments see more modest rent rises
The cost of renting overall is on the up - but the increases are far more modest when you look at the city-wide average.
Third-quarter rental data from ValuStrat, released in early October, painted a more measured picture than many agents gave.
The average villa landlord asked for 14.1 per cent more in rent in Q3 2021 than they did in the same period in 2020, while the average apartment rent rose by just 2.6 per cent. ValuStrat said average prices were significantly more affordable than during the spike seen in 2013-14, after Dubai won its Expo 2020 bid.
Jumeirah Village Circle (JVC) is the most searched for location in Dubai by people looking for budget-friendly apartments, according to a Q3 report from property portals Bayut and Dubizzle.
The average cost of a two-bedroom apartment there has risen from Q2 by less than five per cent, from last year, to Dh62,000.
The increase in cost for a one-bedroom flat has risen by just over one per cent in JVC to Dh43,000.
Dubai Marina remains the most popular location for a luxury apartment according to the report, with prices increasing from six to 12 per cent across the board.
The average cost of a one-bedroom apartment in Dubai Marina is Dh67,000, with two-beds going for Dh100,000 and three-bedrooms fetching Dh156,000.
Some areas have seen no increase in rental prices at all such as Bur Dubai, where the average cost of one and two-bedroom apartments is the same in Q2, at Dh45,000 and Dh66,000 respectively.
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'Landlords shouldn't be too greedy'
Mr Shetliffe was showing three-bedroom and four-bedroom villas to potential tenants when The National tagged along.
He is also accompanied by an agent for the landlord, hoping to strike a deal and get the property off the market.
“The landlords often have a lot of agents in their ears,” he said.
“I’ve been in the situation where the tenant offers to pay the asking price and you think it’s a done deal.
“Then the very next day you’re told someone has come in offering more money.”
Another sign the pendulum is swinging in the favour of landlords is a renewed demand for rent to be paid by one annual cheque, rather than numerous cheques throughout the year.
It was not uncommon for some landlords to accept 12 monthly cheques in recent years, allowing tenants to stagger rent payments throughout the year.
Not anymore, according to Mr Shetliffe.
“In the last few years the landlords were accepting multiple cheques and some were offering a free month of rent, which meant you would get 13 months for the price of 12 as an incentive,” he said.
“Now because of the demand it’s going back to a lower number of cheques per year.
“Some people are still paying 12 cheques but it’s happening a lot less now.”
Mr Shetliffe said there had been a noticeable increase in people relocating to Dubai in recent months, which he put down to a renewed confidence in the region due to the successful handling of the Covid-19 crisis.
'A good community and a school nearby'
New arrivals such as Leo Zambitte, a marketing manager who is moving from London with his wife and daughter, are looking for a villa in the suburbs.
"My company wants me to move here because we do a lot of business in the region and it’s easier to manage that from here,” he said, after being shown around.
“We’re looking for a place that’s the right size for us with a good community and school nearby.
“It has to be reasonable though, as we don’t want to bankrupt ourselves.”
Another estate agent said the demand for townhouses and villas exploded during the pandemic, which led to an exodus of people moving from apartments to bigger properties in the suburbs of Dubai.
“People started to move to cost-effective villa communities outside of the centre of Dubai in the pandemic,” said Leigh Wilmot, senior property consultant with Treo Homes.
“This has resulted in the availability of townhouses and villas reducing, hence the price increase that we are seeing now.”
Mr Wilmot works in the Town Square community in the outskirts of Dubai on Al Qudra Road.
Renting a three-bedroom townhouse there would have cost Dh80,000 last year. The same type of property is now going for Dh105,000.
Four-bedroom townhouses are up to Dh120,000 from Dh95,000 in the same period.
“Out of 2,500 properties on our books, I would say we have four available right now,” he said.
The increase in rental costs is even higher in other parts of the emirate, added Mr Wilmot.
“There are properties in Dubai Hills that were renting for Dh100,000 to Dh125,000 this time last year,” he said.
“Now you are looking at Dh190,000 to Dh200,000 for those very same properties.”
Another area seeing rises is Damac Hills, also close to Al Qudra Road.
“The demand we are experiencing in Damac Hills is exponential. A villa that I rented to a tenant last year for Dh185,000 has rented this year for Dh275,000," said Conor Thompson, from Allsopp and Allsopp.
"A high number of my clients are families that have relocated to Dubai from the UK and Europe.
"With the market showing no signs of regression, I am confident that this demand will continue throughout Q4 of 2021, and is not showing any signs of slowing down anytime soon."
Stamp duty timeline
December 2014: Former UK finance minister George Osbourne reforms stamp duty, replacing the slab system with a blended rate scheme, with the top rate increasing to 12 per cent from 10 per cent:
Up to £125,000 - 0%; £125,000 to £250,000 – 2%; £250,000 to £925,000 – 5%; £925,000 to £1.5m: 10%; Over £1.5m – 12%
April 2016: New 3% surcharge applied to any buy-to-let properties or additional homes purchased.
July 2020: Rishi Sunak unveils SDLT holiday, with no tax to pay on the first £500,000, with buyers saving up to £15,000.
March 2021: Mr Sunak decides the fate of SDLT holiday at his March 3 budget, with expectations he will extend the perk unti June.
April 2021: 2% SDLT surcharge added to property transactions made by overseas buyers.
More coverage from the Future Forum
The five pillars of Islam
WHAT ARE NFTs?
Non-fungible tokens (NFTs) are tokens that represent ownership of unique items. They allow the tokenisation of things such as art, collectibles and even real estate.
An NFT can have only one official owner at one time. And since they're minted and secured on the Ethereum blockchain, no one can modify the record of ownership, not even copy-paste it into a new one.
This means NFTs are not interchangeable and cannot be exchanged with other items. In contrast, fungible items, such as fiat currencies, can be exchanged because their value defines them rather than their unique properties.
Key findings of Jenkins report
- Founder of the Muslim Brotherhood, Hassan al Banna, "accepted the political utility of violence"
- Views of key Muslim Brotherhood ideologue, Sayyid Qutb, have “consistently been understood” as permitting “the use of extreme violence in the pursuit of the perfect Islamic society” and “never been institutionally disowned” by the movement.
- Muslim Brotherhood at all levels has repeatedly defended Hamas attacks against Israel, including the use of suicide bombers and the killing of civilians.
- Laying out the report in the House of Commons, David Cameron told MPs: "The main findings of the review support the conclusion that membership of, association with, or influence by the Muslim Brotherhood should be considered as a possible indicator of extremism."
Who has lived at The Bishops Avenue?
- George Sainsbury of the supermarket dynasty, sugar magnate William Park Lyle and actress Dame Gracie Fields were residents in the 1930s when the street was only known as ‘Millionaires’ Row’.
- Then came the international super rich, including the last king of Greece, Constantine II, the Sultan of Brunei and Indian steel magnate Lakshmi Mittal who was at one point ranked the third richest person in the world.
- Turkish tycoon Halis Torprak sold his mansion for £50m in 2008 after spending just two days there. The House of Saud sold 10 properties on the road in 2013 for almost £80m.
- Other residents have included Iraqi businessman Nemir Kirdar, singer Ariana Grande, holiday camp impresario Sir Billy Butlin, businessman Asil Nadir, Paul McCartney’s former wife Heather Mills.
Hunting park to luxury living
- Land was originally the Bishop of London's hunting park, hence the name
- The road was laid out in the mid 19th Century, meandering through woodland and farmland
- Its earliest houses at the turn of the 20th Century were substantial detached properties with extensive grounds
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Company profile
Name: Infinite8
Based: Dubai
Launch year: 2017
Number of employees: 90
Sector: Online gaming industry
Funding: $1.2m from a UAE angel investor
HEADLINE HERE
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Fixtures and results:
Wed, Aug 29:
- Malaysia bt Hong Kong by 3 wickets
- Oman bt Nepal by 7 wickets
- UAE bt Singapore by 215 runs
Thu, Aug 30: UAE v Nepal; Hong Kong v Singapore; Malaysia v Oman
Sat, Sep 1: UAE v Hong Kong; Oman v Singapore; Malaysia v Nepal
Sun, Sep 2: Hong Kong v Oman; Malaysia v UAE; Nepal v Singapore
Tue, Sep 4: Malaysia v Singapore; UAE v Oman; Nepal v Hong Kong
Thu, Sep 6: Final
Ten tax points to be aware of in 2026
1. Domestic VAT refund amendments: request your refund within five years
If a business does not apply for the refund on time, they lose their credit.
2. E-invoicing in the UAE
Businesses should continue preparing for the implementation of e-invoicing in the UAE, with 2026 a preparation and transition period ahead of phased mandatory adoption.
3. More tax audits
Tax authorities are increasingly using data already available across multiple filings to identify audit risks.
4. More beneficial VAT and excise tax penalty regime
Tax disputes are expected to become more frequent and more structured, with clearer administrative objection and appeal processes. The UAE has adopted a new penalty regime for VAT and excise disputes, which now mirrors the penalty regime for corporate tax.
5. Greater emphasis on statutory audit
There is a greater need for the accuracy of financial statements. The International Financial Reporting Standards standards need to be strictly adhered to and, as a result, the quality of the audits will need to increase.
6. Further transfer pricing enforcement
Transfer pricing enforcement, which refers to the practice of establishing prices for internal transactions between related entities, is expected to broaden in scope. The UAE will shortly open the possibility to negotiate advance pricing agreements, or essentially rulings for transfer pricing purposes.
7. Limited time periods for audits
Recent amendments also introduce a default five-year limitation period for tax audits and assessments, subject to specific statutory exceptions. While the standard audit and assessment period is five years, this may be extended to up to 15 years in cases involving fraud or tax evasion.
8. Pillar 2 implementation
Many multinational groups will begin to feel the practical effect of the Domestic Minimum Top-Up Tax (DMTT), the UAE's implementation of the OECD’s global minimum tax under Pillar 2. While the rules apply for financial years starting on or after January 1, 2025, it is 2026 that marks the transition to an operational phase.
9. Reduced compliance obligations for imported goods and services
Businesses that apply the reverse-charge mechanism for VAT purposes in the UAE may benefit from reduced compliance obligations.
10. Substance and CbC reporting focus
Tax authorities are expected to continue strengthening the enforcement of economic substance and Country-by-Country (CbC) reporting frameworks. In the UAE, these regimes are increasingly being used as risk-assessment tools, providing tax authorities with a comprehensive view of multinational groups’ global footprints and enabling them to assess whether profits are aligned with real economic activity.
Contributed by Thomas Vanhee and Hend Rashwan, Aurifer
World record transfers
1. Kylian Mbappe - to Real Madrid in 2017/18 - €180 million (Dh770.4m - if a deal goes through)
2. Paul Pogba - to Manchester United in 2016/17 - €105m
3. Gareth Bale - to Real Madrid in 2013/14 - €101m
4. Cristiano Ronaldo - to Real Madrid in 2009/10 - €94m
5. Gonzalo Higuain - to Juventus in 2016/17 - €90m
6. Neymar - to Barcelona in 2013/14 - €88.2m
7. Romelu Lukaku - to Manchester United in 2017/18 - €84.7m
8. Luis Suarez - to Barcelona in 2014/15 - €81.72m
9. Angel di Maria - to Manchester United in 2014/15 - €75m
10. James Rodriguez - to Real Madrid in 2014/15 - €75m
