Dubai’s short-term rental market is booming, driven by tourism, business travellers and expats seeking flexible accommodation. With platforms like Airbnb and Booking.com gaining traction, short-term rentals in Dubai have become a profitable investment avenue. However, before diving in, it’s essential to understand the legal framework and know which areas yield the best returns.
Here’s your ultimate guide to short-term rental legalities and the most profitable areas for short-term rentals in Dubai.
Legal Requirements for Short-Term Rentals in Dubai
Dubai’s short-term rental market is regulated to ensure high-quality experiences for guests and fair practices for landlords. The governing authority for holiday homes is the Department of Economy and Tourism (DET), formerly known as DTCM. Here’s what you need to legally operate a short-term rental:
Holiday Home Permit
- Individual property owners or management companies must apply for a permit from the DET.
- The permit is renewable annually and varies in cost based on unit type and classification.
Ejari Registration
- Though not always mandatory for holiday homes, some cases require your tenancy contract to be registered under Ejari.
No Objection Certificate (NOC)
- In some buildings or communities, landlords may need a NOC from the developer or homeowners’ association to operate a holiday home.
Compliance with Safety & Hospitality Standards
- Properties must meet health, safety, cleanliness and furnishing standards to qualify as a licensed holiday home.
Important Note: Listing an unlicensed property on short-term platforms can result in heavy fines up to AED 100,000. Partnering with a registered property management company in Dubai can streamline the licensing and compliance process.
Top Profitable Areas for Short-Term Rentals in Dubai
Location is everything when it comes to short-term rental profitability. Here are some of the best-performing areas in Dubai that attract high occupancy rates and solid nightly rates:
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Dubai Marina
One of the top choices for both tourists and business travellers, Dubai Marina is packed with luxury apartments, waterfront views and easy access to restaurants, shops and the beach.
Best unit types: 1-2 bedroom apartments
2. Downtown Dubai
With landmarks like Burj Khalifa, Dubai Mall and the Dubai Fountain, Downtown Dubai remains one of the highest-yielding areas for short-term rentals.
Ideal for: Luxury and high-end travelers
3. Palm Jumeirah
Palm Jumeirah attracts affluent tourists and families looking for beach access and resort-style living. Holiday homes here command a premium.
Best for: Villas, high-end apartments, sea views
4. Jumeirah Beach Residence (JBR)
Perfect for beachgoers and families, JBR offers high yields with its vibrant community feel and beachfront properties.
Best unit types: Fully furnished apartments and sea-view units
5. Business Bay
Close to Downtown but slightly more affordable, Business Bay is popular with digital nomads and corporate travellers.
Best for: 1-bedroom modern apartments
Why Consider Short-Term Rentals in Dubai?
- High ROI potential compared to long-term rentals
- Flexible pricing that adapts to demand and events
- Strong tourism market with over 17 million visitors expected in 2025
- Investor-friendly regulations and tax-free income
The Dubai short-term rental market is a golden opportunity for investors, offering high yields, strong demand and a regulated environment. Whether you’re buying in Dubai Marina for beach-loving tourists or Downtown for high-end travellers, success lies in location, licensing and professional property management.
From finding the ideal property to managing your short-term rentals, Luxfolio makes the process smooth and stress-free.