Daily Apartment Rental in Dubai: Basic Rules

11:57 pm  |  20.09.2023

What you need to know before renting an apartment daily in the UAE. Read the rules and regulations for renting apartments in Dubai.

How to Obtain a License and Permit

To rent apartments in Dubai on a daily basis, the owner needs to obtain a license and permission to operate a hotel. Each guest must be registered in a particular system and pay a monthly tourist tax. We will tell you more about how to rent apartments in Dubai by the day in this article.

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Daily rental activities are regulated by the Department of Tourism and Commercial Marketing (DTCM). To have the right to rent out apartments for daily rent, the owner must obtain a license – Holiday Home Permit. In the third quarter of 2023, it cost AED 1.5 thousand (USD 408 thousand).

An owner can register up to 8 properties on the Holiday Homes portal. For each of these residences, you must additionally obtain a permit – Unit Permit. It is also issued by DTCM. The cost is calculated depending on the number of bedrooms – AED 70 (USD 19) for the entire apartment + AED 300 (USD 82) for each bedroom.

To register an apartment the owner needs:

  1. Login to the Holiday Homes portal and register for an account.
  2. Add a property. To do this, click “Add Unit” and enter the required information: building name, property type, number of bedrooms, and area.
  3. Upload documents. The list of required documents is given below.
  4. Submit your application. Before doing this, check the data again and submit your application on the website. The Department will review it within one business day and send a response by email.
  5. Pay the fees. This can be done by bank transfer or cash from the Dubai Department of Economy and Tourism (DET).

If you paid via DET, the payment will be confirmed automatically. If you made a bank transfer, the payment will need to be confirmed:

  1. Click on the “Confirm Payment” button next to the property.
  2. Enter details.
  3. Specify the type of payment – bank transfer.
  4. Upload your bank receipt.
  5. Confirmation will arrive within 2 business days.

Documents that the owner needs to upload to the Holiday Homes portal:

  • a copy of the title deed or purchase agreement and payment completion certificate;
  • copy of the owner’s passport or Emirates ID;
  • Dubai Electricity and Water Authority (DEWA) current account.

Tenants who rent apartments long-term can also apply for a Holiday Home Permit for this apartment and rent it out on a daily basis. Before this, the tenant must obtain permission from the owner. Only one object can be registered. In this case, additional documents will be needed:

  • lease contract;
  • Ejari documentation.

The permit is valid for a year. If it is not renewed on time, the owner will have 

to register on the portal again.

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How to Renew Your Permit

Dubai view

30 days before the permit expires, a notification will appear in your personal account on the Holiday Homes portal. To renew your permit you need to:

  1. Log in to your account on the Holiday Home portal.
  2. Click “Renew the Holiday Home Permit”.
  3. Upload documents – the same ones that were provided during registration.
  4. Submit your application.
  5. Pay the fees.

How to Register Guests 

The owner must register guests and upload documents and their personal details to the DTCM website at the time of arrival.

A tourist tax – Tourism Dirham – is charged per night of stay in the amount of AED 10 (USD 2) for each bedroom. Tax must be paid no later than the 15th of the next month. For example, tax for June is paid until July 15.

The owner must indicate the amount of the tourist tax on the receipt or any other document confirming the rental payment. The amount is paid as a separate item – Tourism Dirham.

If the owner lives in the apartment, no tax is charged for this period, but you will still have to register for DTCM. If one group of guests stays in an apartment for more than 30 days, no tourist tax will be charged for this period.

Where to Look for Tenants

The ad can be published on special services such as Booking, Airbnb, PropertyFinder, VRBO, TripAdvisor, etc. On these sites, guests can book apartments online. You can also specify additional amenities, such as remote check-in. To eliminate the risk of double booking for the same dates on different portals, you can set up synchronization.

What Income Can You Expect

The average daily rental cost is AED 550 (USD 150). This is about AED 200 thousand (USD 54.5 thousand) per year.

To understand what the average daily rental yield will be for one-bedroom apartments, let’s make calculations. As an example, let’s take one of the most popular areas among tourists – Downtown Dubai.

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From the amount mentioned above, we subtract:

  1. Holiday Home Permit license – AED 1.5 thousand (USD 408 thousand).
  2. Unit Permit – AED 370 (USD 100).
  3. Tourist tax – about AED 3.6 thousand (USD 980) per year.
  4. Utility bills, and internet – about AED 12 thousand (USD 3.3 thousand) per year, according to Numbeo.
  5. Maintenance of the complex – on average AED 7.2 thousand (USD 2 thousand) per year.

Taking into account all these costs, owners can count on approximately AED 175 thousand (USD 47.6 thousand) net profit per year.

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