LANDLORDS SHIFT GEARS ON LEASES

Short stays slip as one-year rentals rise in Dubai

- BY MANOJ NAIR

The number of new residential units being added to Dubai's short-stay rental markets continue to rise — but landlords will do well to keep close check on the kind of rates they are being leased for.

They need to because the other option — leasing their properties for one-year contracts — is still recording sizeable increases in rates.

There was a wake-up call of sorts for short-stay favouring landlords during the period leading up to the Eid break in late March.

“The short-stay rental/holiday home market was looking at a drop of about 15 per cent on ADR (average daily rates) and a reduced occupancy of 20 per cent-25 per cent,” said Vinayak Mahtani, CEO of the property leasing and management company bnbme. “The main reason for the drop in rates was that a lot of UAE residents — who would typically opt for staycations during Eid breaks — preferred to travel out this year.

“There was another reason for the impact on demand - the increase in number of short-stay units in Dubai. Then, it created a situation where demand did not end up following the actual increase in supply.”