A recent study by real estate consultancy Betterhomes reveals that property owners in Dubai earn, on average, over Dh13,000, which is 41% more than tenants. This significant income disparity is highlighted in the report titled 'The Future Living: The Dubai 2024 Edition'. According to the report, tenants in Dubai earn an average of Dh32,303 per month, while property owners take home Dh45,616 monthly. The steady increase in rental rates over the past three years has significantly boosted the income of property owners. As of June 2024, the annual rents for average apartments and villas in Dubai were Dh127,969 and Dh354,512, respectively. The highest annual rents for apartments and villas were recorded in Palm Jumeirah and Al Barari, with average asking rents of Dh279,826 and Dh1,344,844, respectively, according to CBRE’s second-quarter report.
The report notes that the growth rate of rents remained robust, with average residential rents increasing by 21.1% from the previous year until June 2024. This growth was driven by a 22.2% increase in average apartment rents and a 12.7% rise in average villa rents. Mercer, a global human capital consultancy, projects that salaries in the UAE will rise faster than the inflation rate in 2024, driven by increased demand for talent and economic growth. The average salary in the UAE is expected to increase by 4% this year, compared to a 2.3% rise in inflation.
Betterhomes’ income analysis indicates that 63% of respondents earn Dh50,000 or less per month. The survey, which involved over 1,600 residents, identified millennials (aged 28 to 43) as the dominant demographic, making up 56% of respondents. Millennials are leading the property ownership and rental markets in Dubai, driven by the city’s rising property prices and strong rental yields. While renters constitute a significant portion of Dubai’s population, the survey shows a growing interest in home ownership, signaling a strong demand for buying options in the city.
The report by a property brokerage firm indicates that 77% of respondents currently rent their residences, with 79% of tenants opting for long-term lease agreements. This underscores the transient nature of Dubai’s population, where flexibility and lower financial commitments are key drivers of rental preferences. Betterhomes’ survey found that 72% of Dubai residents have lived in the city for more than five years, and 89% plan to stay for at least five more years. This reflects a significant shift in the longevity of residents’ stay in the emirate, influenced by long-term residency programs like the Golden Visa and Silver Visa.
Richard Waind, CEO at Betterhomes, shared his personal experience, noting that Dubai has evolved from a short-term destination to a place where people are putting down roots, growing families, and buying homes. This change is reshaping Dubai’s real estate landscape and bodes well for the market’s future sustainability.
