Where is the best place to make a good investment in Dubai? We tell you about the best neighborhoods in Dubai for renting a home or renting out your property. 

How is the Rental Market in Dubai Evolving?

Dubai, the capital of the UAE emirate of the same name, is the most densely populated among the country's seven emirates. At the time of publication of this article, the population of Dubai is 3.65 million. At the same time, the vast majority (about 85%) are foreigners. Last year, the number of residents there increased by 100,000. 

Together with the population, the demand for Emirati real estate is growing. For comparison: if in October 2022 a total of 53,756 lease agreements were concluded in Dubai, in October 2023, 60,963 lease agreements were concluded (of which 56.50% were new and 43.50% were extended).

Total monthly index based on October 2022 data

Total monthly index based on October 2022 data

According to experts, the rental market in Dubai in October 2023 showed an increase in the number of contracts by 13.41% year-on-year, thanks to a significant increase in renewals by 21.97% and a marked increase in annual contracts.

Total monthly index based on October 2023 data

Total monthly index based on October 2023 data

The 10-year trend is clear: on average, about 80% of rental properties are apartments, while the remaining 20% are villas and townhouses.

It should be noted that the government strictly controls the legislation in the sphere of apartment rentals in Dubai. Thus, the Dubai Land Department, through its subdivision RERA (Real Estate Regulatory Authority), has established mandatory registration of all long-term lease agreements (from 1 year) in a unified electronic system, EJARI.

This system has a number of advantages: it allows controlling and restraining unreasonable rent growth, protects tenants' rights against illegal eviction. Thanks to registration in EJARI, the same property cannot be rented out twice for the same period.

Up-to-date reports on renting and buying real estate, as well as the best investment areas in Dubai, are regularly published by the Emirates Land Department — you can follow them here

Best Neighborhoods to Rent in Dubai

The city is divided into 9 regions, which in turn are divided into districts — there are more than 200 of them in the Emirate. 

So, here are the best neighborhoods to rent in Dubai at the moment, according to the statistics of the Dubai Land Department:

District

Number of transactions in October 2023

Al Mararr 

2407

Jabal Ali First

2143

Business Bay

1884

Al Warsan First 

1822

Al Barsha South Fourth

1817

Al Muteena

1789

Marsa Dubai 

1716

Hor Al Anz

1615 

Nadd Hessa

1359

Abu Hail

1266 


Here is some interesting and important information about each of the locations in this ranking of Dubai neighborhoods.

Al Mararr

The Al Murarr neighborhood is located in the Deira district, close to Dubai International Airport and the new Al Maktoum International Airport. Both locals and expats live in the neighborhood. 

Both residential and commercial properties can be rented in Al Murar. Office space can be rented for AED 40,000 (~$10,900) per year for 300 square meters. 

As the neighborhood is overpopulated, there are only a few apartments available for rent here. Studio rentals in Al Murar range from AED 20,000 to 36,000 (~$5450–$9800) per year.

Jabal Ali First

The Jabal Ali First neighborhood is located next to the Dubai Marina area. It is characterized by a developed infrastructure and convenient location, which allow easy access to the main attractions and social infrastructure of Dubai (restaurants, shopping malls, supermarkets, and medical facilities).

The area is home to more than 7,000 companies involved in commerce, logistics, manufacturing, and various industries and services. Jabal Ali First is also a major commercial port.

Skilled professionals and families usually choose to live in the area. The local real estate market offers many types of properties, ranging from apartments to villas and penthouses. Rental prices for villas start at AED 135,000 (~$36,750) per year, while office space can be rented for AED 45,000 (~$12,250) per year. 

Housing in Dubai

Business Bay

Business Bay is one of the financial centers of the Middle East. It is located between Downtown and Jumeirah, on the shores of Dubai Bay. Numerous office buildings are concentrated here, but there are also residential complexes.

The district is attractive for young professionals and entrepreneurs. About 18 thousand companies are registered here. At the same time, there are practically no parks and playgrounds. In the neighborhood of Business Bay, there are two prestigious international schools: GEMS and Safa British School.

Prices for rental apartments depend on the size and level of luxury of the object. For example, studios on average can be rented for AED 72,000 (~$19,600) per year, one-bedroom apartments for AED 97,000 (~$26,400), two-bedroom apartments for AED 149,000 (~$40,500), and three-bedroom apartments for AED 228,000 (~$62,100) per year. A three-bedroom villa with two bathrooms can be rented for an average of AED 220,000 (~$60,000) per year. 

Al Warsan First

Al Warsan First is a modern neighborhood that is ideal for families with children. It has a well-developed infrastructure that includes schools, kindergartens, and medical facilities, among others. In addition, Al Warsan is a free economic zone where foreigners can buy real estate.

Rental rates for office space in Al Warsan start at AED 65,000 (~$17,700) per annum. One-bedroom apartments can be rented for around AED 360,000 (~$98,000) per year, and three-bedroom villas for AED 1,500,000 (~$409,000).

Al Barsha South Fourth

Al Barsha South Fourth is part of Al Barsha, a prestigious and developed district of Dubai. It is located in a convenient location that allows easy access to key points in the city.

It mainly features 2-3-bedroom townhouses and villas suitable for small families. There are many schools, supermarkets, and other important infrastructure facilities in the neighborhood.

Rental rates in Al Barsha South Force start at AED 40,000 (~$11,000) per annum for a one-bedroom apartment and up to AED 82,000 (~$22,300) for a three-bedroom apartment.

Al Muteena

Al Muteena is a quiet residential neighborhood in the eastern part of Deira. It offers a variety of housing options, from apartments to villas. Annual rent for a one-bedroom apartment starts at AED 25,000 (~$6800) and for a three-bedroom apartment at AED 60,000 (~$16,300).

There are several schools near Al Muthinna, including Little Flower English School and Pearl Wisdom School Dubai. The Sheraton Deira and Marco Polo Hotel are important attractions in the neighborhood.

District in Dubai

Dubai Marina (Marsa Dubai)

Dubai Marina is a fashionable residential area with developed infrastructure and stunning views of skyscrapers and the artificial bay. There are a lot of residential, commercial, and retail facilities here.

From the disadvantages, we can note the high level of noise, traffic jams during peak hours, and the high cost of housing; the average cost of a square meter is about $14,700. As for rent, prices for one-bedroom apartments in Marsa Plaza, Dubai Festival City, start at AED100,000 (~$27,200); three-bedroom apartments start at around AED190,000 (~$52,000) per annum.

Hor Al Anz

Hor Al Anz is a neighborhood in the eastern part of Dubai that offers a variety of housing options at affordable prices. This neighborhood is popular for its low-rise residential buildings and wide range of apartments.

Annual rents for office space in Khor Al Anz range from AED 18,000 to AED 80,000 (~$5000-$22,000) depending on the area. Apartment prices also vary: studios, for example, can be rented for AED22,000 (~$6,000) per year.

Nadd Hessa

Nadd Hessa is a quiet suburb of Dubai that will suit those seeking harmony and the same lifestyle. There is a variety of housing here — there are both apartments and villas. The neighborhood is inhabited by both locals and expats.

According to the Dubai Statistics Center, more than 1.2 million people live in Sector 3, which includes Nadd Hessa. That's 36% of Dubai's total population.

A year's rent for a spacious one-bedroom apartment will cost around AED38,000 (~$10,400). 

Abu Hail

Abu Hail boasts modern infrastructure, including the Abu Hail Center shopping mall. It is home to a metro station on the Dubai Metro's Green Line, which serves the area and nearby Khor Al Anz. 

The area is fairly cheap to live in by Dubai standards — annual studio rent starts at AED 25,000 (~$6,800). The neighborhood of Abu Hail is home to shopping centers, restaurants, cafés, sports facilities, and attractions. 

What will Happen to Rental Prices in Dubai?

Experts predict that in the near future, there will be no significant decrease in rental rates in Dubai. However, the situation may be affected by the innovations of the Department of Land Development (DLD).

To regulate rental prices, DLD has decided to replace the current rental index with a rating system for residential buildings. Whereas previously the index was mainly determined by location, it will now be calculated based on tenants' feedback on the level of comfort and convenience. 

Residents will rate various aspects from 1 to 4 stars: proximity of infrastructure, transportation accessibility, quality of finishing, work of the management company, etc.

Owners of buildings with high ratings will be free to raise rents. And to raise rates in low-rated buildings, the authorities' permission will be required.

According to experts, the new system is unlikely to stop the growth of prices, but it may slow down the rate of increase in rates for apartments. At the same time, the rating will not yet be introduced for villa rentals.