Dubai: For anyone planning to book a holiday home in Dubai during the second-half of December, here’s a word of advice – Do It Fast. That’s because short-stay or holiday home rentals are recording almost overnight gains and could be touching record highs ahead of New Year’s Eve.
“Everyone in the world seem to have decided they will spend New Year in Dubai,” said an owner of multiple luxury properties available for shorty-stays. “At least, even with the steep rates being asked, property owners and management companies are getting instant bookings.”
The build-up in demand and rates are already being felt. Apartments that were fetching Dh150 a night in summer are now listing at Dh800. “I have a studio at DIFC that’s now at Dh615 a night – and for the New Year it’s Dh1,822.”
Out on the Palm, short-stay rentals closer to end of the year could soar past Dh2,500 and well over. Some in the industry feel, rates could push into record territory for properties with a sea-view or closer to where the New Year’s Eve attractions are being held. The message is clear – holiday homes in Dubai are back to making money and quite a lot of it at that.
Message for investors
Mark Castley, Sales Director at LuxuryProperty.com, believes that this is an ideal opportunity for investors to expand their Dubai portfolios and “capitalize on the returns provided by short-term rentals. “Right now, holidaymakers and tourists are drawn to short-term rental contracts, as a furnished home gives them complete privacy, extra space, easy access to transportation links and a thriving community where they can interact with others,” he said. “This makes an attractive proposition for homeowners who can receive a stable source of income without any hassle.”
Airline industry sources confirm that December will be an “exceptionally busy” month this year, with the Expo-created demand adding another layer to add to the tourist arrivals. But Castley says the current surge is much more than that.
Sure, “Demand has primarily been fuelled by tourists and visitors coming for Expo 2020, but also by expats who want a chance to immerse themselves in the city before making a longer commitment,” he said. “Communities located a short distance away from Expo such as Jumeirah Golf Estates, Mudon and Town Square are quite highly sought after and very much of the moment.
“However, there are also the ‘evergreen’ communities of Dubai, the ones that are always in demand no matter what the occasion – Palm Jumeirah, Dubai Marina and Jumeirah Beach Residence. Demand in these areas is particularly high over the winter season, and especially close to New Year’s.”
Landlords will be convinced
All of this sounds far removed from the uncertainty that shrouded the holiday-home market nearly all through last year, except for a pickup in December. The pandemic’s impact did have many property owners thinking whether they should exit the short-stay rental space and just opt for the surety of long-term lets. Those doubts were cleared by the time the Expo got going on October 1.
Even ahead of the opening day, the booking enquiries were building up nicely. Anna Skigin, CEO of Frank Porter, provides an update: “Areas surrounding the Expo site were becoming more popular, even though we were seeing a lot more properties come in the surrounding areas such as Dubai South. These new ones are already showing good occupancy.
“The occupancy were very high over May and June last, at above 87 per cent. July and August turned out to be lower – at 65-75 per cent - due to many closed borders. But all that changed from September/October - all in line with positive news (on vaccines) coming from everywhere.” (The September spike also had to do with multiple exhibitions and conferences making a return, to set up a busy schedule ahead of the Expo opening.)
Any holiday home property with an unfettered view – say, of the sea or to New Year’s Eve fireworks – will command a premium over those that come with just a plain-vanilla sight. But, that does not seem to be the case this year.
“I have a unit next to a tower project – there’s no view apart from the construction,” said a property owner. “Yet, my unit has managed to pick up some crazy booking rates for December..”
Everyone seems to be having a plan to be in Dubai this December.