Property rental prices in Dubai may increase by 10-20% after RERA calculator update

Real estate industry insiders have highlighted the possibility of rents increasing by 10 to 20 per cent in the coming months following the recent update of the Real Estate Regulatory Authority (Rera) index for Dubai.

The revised Rera The calculator, effective March 1, is expected to affect tenants who reside in properties for more than two years.

According Richard Waind, CEO of Betterhomes, The updated calculator more closely aligns future renovations with current market rents, which could lead to larger rent increases for renters who have been in their homes for an extended period.

waind anticipates that this may lead some tenants to consider moving or downsizing, while others may choose to enter the housing market. The segments that are likely to be most affected are areas that have seen significant increases in rents over the past two years, especially central villa communities and beachfront apartment communities. Despite the expected increase in short-term rentals, industry executives believe the calculator overhaul could help reduce long-term rentals. The previous calculator created a disparity between renovation prices and open market rents, causing market stagnation.

waind suggests that an increase in renovation costs can stimulate the market, potentially increasing the supply of housing in popular villa communities and subsequently reducing rents on the open market.

News Source: Khaleej Times