Over the past years, there has been a lot of excitement in Dubai’s real estate industry for a good reason. Almost 80% of local and global investors have doubled their savings. The only despair is to see newbies juggling between short-term vs long-term rentals.
Making up your mind to invest in such a profitable city like Dubai is easy. Still, if you need more clarification on your investment goals, keep reading the guide below.
Short-term vs Long-term Rentals: Which is better?
Most of us prioritise making future plans ahead of time while expecting guaranteed profitability. Of course, everyone wants to make the most of the investments, one way or another. In this regard, doing a comparison of short-term vs long-term rentals can take you out of this misery.
Here’s a rundown of a short guide on each of the investment options and which one suits your pursuit.
Holiday/Short-term Rentals in Dubai
Investing in Dubai is lucrative for a million reasons, and holiday homes are a significant part of this queue. While these properties are mainly dedicated to tourists and vacationers, business persons prefer renting them. But why? Let’s find out together.
Head over to the pros and cons of both investment options and bid goodbye to the turmoil of short-term vs long-term rental situations.
Pros of Short-term Rental Properties
Easy to manage
Holiday houses are relatively easier to manage in terms of servicing and furnishings. As for tourists, it simplifies the settling-in process. Due to the reason that they spend most of their time outdoors, there are fewer chances of any repairs or damages.
Predictable Cash flow
It’s no secret that Dubai hosts some of the most exclusive global events and sports tournaments. Since prices for hotel suites tend to be higher in the UAE, most visitors opt for short-term rentals. Ultimately, it facilitates a dependable investment option when considering short-term vs long-term rental.
Not only this, but holiday homes also benefit from neighbouring areas. For example, the demand for short-term rentals has seen a sharp upward trend, with FIFA World Cup 2022 taking place in Qatar.
Possibility of Customisation
Renting out your property for a shorter period promises customisation. As an owner, you can always have the property to yourself and rent it out whenever you wish. Also, selling it on short notice isn’t hectic either, with a productive prestige.
Cons of Short-term Rental Properties
Getting impressed with the benefits of short-term rentals isn’t new. However, you must consider what drawbacks it holds for you.
Lack of Stability
Imagine giving up your property for rent to some visitors, only to know that they have ghosted your house a week ago. Since you couldn’t investigate much about them, there was no credibility in the contract from the beginning.
Marketing and Advertising Costs
As short-term rental properties stay vacant most of the time, how will you notify the prospects about it? Of course, it’ll take you to advertise and market your property on portals, which can be a costly affair.
Short-term rentals require monthly maintenance than long-term rentals due to the frequent tenant turnover. Assuming you have a busy schedule, it’s hard to pay attention so often.
Long-term Rentals Properties
Long-term rental properties in Dubai are predictably rented for an extended period, probably over one year. This housing arrives with an annual tenancy contract registered by RERA. But what does this rental scheme bring to your table? Let’s determine it below.
Pros of Long-term Rental
Dubai is always up to something to bring you on your “A” game. We’re talking about none other than the latest updates about golden visas for property investors. The same reason has been escorting millions of expats to the city. That’s why investing in long-term rental properties sounds like a productive endeavour.
Stability of Finances
There’s no denying that people always need a home to live in, regardless of the city’s economic conditions. This feasibility allows you to generate a stable passive income and make a living. When you don’t have to deal with regular repairs, it is a viable option between short-term vs long-term rentals.
A Budget-friendly maintenance
Long-term rental properties require less attention as there isn’t a frequent tenant turnover. As tenants cater to most of the maintenance according to their taste, there’s little left for you.
Cons of Long-term Rental Properties
With a long-term rental contract, there’s no flexibility. Once you’ve handed over the keys to tenants, you can’t make any changes there, legally.
Risky Cash Flow
It might take time to find a suitable tenant since it’s a long-term connection. Situations like this can leave you without a constant income for some time.
Unstable Rental flow
Predicting the future isn’t in your hands, and the rental market keeps fluctuating with Dubai’s economic conditions. Adding to this, you can’t increase the rent based on the market values.
By delving into the debatable short-term vs long-term rentals argument, you must have got a whole new perspective.
Undoubtedly, the recent investor visa updates are enough to entice you. On the other hand, the evergreen bandwagon of global festivals excels at drawing the tourist’s eye. If you’ve finally decided to invest here, check out our property listings at Zoom Property and get better exposure to the insights.