Dubai allures the world with its sky-high residential properties. The city’s villas, apartments, and townhouses are becoming the most sought-after options amongst tenants due to their varied styles, location, and budget-friendliness. However, tenants are still in a dilemma about which property has the best rental value.
It is pivotal to know the rental value of each property before making your mind to choose among an elegant rental apartment at Dubai Marina, a spacious villa in Arabian Ranches, or a European-styled townhouse at Jumeirah Golf Estates.
This article will guide you in making a better choice which type of property offers the best rental value –
Living in Villas symbolizes luxury due to high space, and a list of private amenities. This is the prime reason villas attract a higher price and rental rates across the globe. However, it is not always the same. It depends on several factors such as the location of the property, proximity to essential places, number of rooms, space available in the property, etc.
Factors Determining the Rental Value of the Property:
The location has a profound impact on the rental value of a property. Although villas attract higher rents, however, if the apartment is rented at a prime location, the average rent can be much higher than the villa located in a suburb or a very remote area.
The proximity of a property from essential places such as schools, colleges, hospitals, etc. is also a key factor that determines the demand for the property. Tenants who prefer these establishments nearer to them choose to live in apartments, while those who prefer space, luxury, and living peaceful life away from the city’s crowd prefer to live in villas.
Another key factor that influences the price or the rental value of the property is the number of rooms rented. Generally, villas attract higher rents due to a more number of rooms compared to an apartment or a townhouse, and also offer more privacy. Furthermore, villas offer more private amenities such as pools, gardens, etc. It is also important to note that while renting villas or apartments, there are several additional expenses on top of rent that are incurred by the tenants. These additional costs include – maintenance charges, electricity charges, and the cost of furniture. It is always recommended to buy your furniture if you are staying for long to cut on those costs. Considering villas are larger in size with more rooms, the cost of running a villa is much higher. Even if you are lucky to find a villa with lower rent, after adding maintenance & electricity charges, cleaning costs, cost of hiring a plumber or gardener, cost of maintaining the backyard, and other additional expenditures, you will still find villas several fold expensive compared to an apartment.
Rent Value for Villas, Apartments, and Townhouse:
According to Bayut, the annual rents for 2-bedroom houses start from AED 50k and go up to AED 170k per annum for more luxurious units in an upscale neighborhood like Palm Jumeirah.
For tenants looking to rent 3-bedroom villas in Dubai under AED 115k per annum, the most relevant options are Mirdif, Akoya Oxygen, Reem, DAMAC Hills (Akoya by DAMAC), and International City. The rental rate for a 4-bedroom villa ranges between AED 90k to AED 800k. 5-bedroom homes are priced from AED 70k in Akoya Oxygen to AED 1.1M in Palm Jumeirah.
The average rent for a 2-bedroom apartment in Dubai ranges between AED 40k – 70k annually. As per Bayut data, there is a vast range of cheap 2 BHK apartments for rent in Dubai. The top area for 2-bedroom apartments for rent in Dubai in the range of AED 70k includes – Al Nahda (AED 47,000), Bur Dubai (AED 65,000), Jumeirah Village Circle (AED 65,000), Al Warqaa (AED 46,000), and Dubai Silicon Oasis (AED 59,000).
The average rent for a 1-bedroom apartment in Dubai is between AED 21k to 65k per annum. One-bedroom apartments for AED 21k can be rented for AED 21k in areas like Al Nahda and Dubai South. The rent for a 1-bedroom apartment in Downtown Dubai and Palm Jumeirah then the rent for a 1 BHK is between AED 45k and AED 65k, respectively.
The rental prices for 2-bedroom apartments in Dubai range from AED 30k to AED 525k. The higher-priced properties are found in exclusive neighborhoods such as Business Bay, Downtown Dubai, and Jumeirah. 3-bed units are priced upwards of AED 45k in the Al Qusais and Jebel Ali communities.
The average price for renting a 3-bed flat in JLT is AED 121k and it is AED 137k in Business Bay. 4-bed units can be found for AED 65k in Deira and go up to AED 800k yearly in Downtown Dubai. A 5-bedroom apartment in Dubai is not that common and prices start from AED 150k in communities such as Dubai Sports City, Jumeirah Lake Towers (JLT) and Jumeirah Beach Residence (JBR).
The latest data from Bayut reveals that average rent for a 1-bedroom townhouse starts from AED 20k in locations like Dubai Industrial Park and goes up to AED 80k in Jumeirah Village Triangle (JVT). The annual rent for a 2-bedroom townhouse would be around AED 40k to AED 130k, depending on the location and whether the property is fully furnished. A 3-bed townhouse for rent in Dubai costs around AED 90k in areas like Noor Townhouses in Town Square with areas spanning over 2,000 sq.ft. The rent for a bigger townhouse with 4-bed and 5-beds is between AED 100k to AED 300k, annually. Data from Property Monitor reveals that the most popular areas to rent a townhouse are – Dubai South, Mohammed Bin Rashid City, Reem, and Town Square.
Apartments Emerge as a Clear Winner in the Rental Value:
Living in apartments is far cost-effective compared to living in a villa or townhouse. Furthermore, the service charges and other maintenance costs are also low. Apartments are also the most desirable option for the tenants as they offer better security compared to any other property type. Proximity to the downtowns and city center is another factor that makes apartments ‘a perfect ten’ for the tenants and boosts their rental value.