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Rent vs buy in Dubai

Article-Rent vs buy in Dubai

Hamza Betraoui, Managing Director at Land Sterling, weighs in on the debate between renting and buying property in Dubai.

In a dynamic city like Dubai, individuals are often confused between renting or owning a property. The market and its volatility have proven that it is often the individual’s risk appetite and necessity which influences the decision and there is no right or wrong judgment for the choice made.

While renting may seem to be an affordable option, there are other influencing factors like the individual’s lifestyle, their budget affability, income security, and one’s own career goals which ultimately impetuses their decision to buy or rent.


As per Dubai Statistics Centre, the young population (Aged 20-30) constitutes about 35% of the overall population. Approximately 90% of this category are expats who are beginning the early stages of their careers. These expats prefer to rent a place than own one due to the various constraints with regards to the ability to pay, contractual commitments, etc. Buying or owning a property is feasible for individuals having the financial means to bear the costs associated with the purchase of a property like government charges, EMI, etc. It is also imperative to note that the loan tenure is considerably lower than the other developing economies like India resulting in higher EMIs. With the emergence of short-term rentals, expats widely prefer renting for a shorter duration (3-6 months) considering the uncertainty in the job market and flexibility in choosing a place to live. Also, the hassle of disposing of (selling a property) can be avoided while leaving the country.

Financial appetite differs from person to person. Owning a place is a good choice for individuals having financial stability. For an average individual, the costs associated with the purchase of the property like brokerage fees, registration fees, moving costs, etc. could be a substantial amount over and above the purchase price of the property. An individual having the ability to cover these costs could decide to buy a property than rent.


The longevity of the stay is a significant factor to be considered before making the decision. Given the facts stated above, renting seems more appealing as the tenant is alleviated from the burden of costs of repairs, renovation of the property and service charges, etc. The mobility and freedom to move places are crucial for individuals who are still uncertain in their career or wants to be financially independent before making the purchase decision.

Buying, however, is a better choice in the long run for those who are certain about a more extended stay in the country. One important and indisputable element is having a sense of stability and permanence. Owning the property gives the person the freedom to customize their living space, which is usually limited while renting. An own house also guards the individual against uncertainties like rising rental costs and the landlord’s decision to sell his or her asset or discontinue renting. While buying seems more expensive at the onset, the rental returns/capital appreciation are some of the factors which influence the purchase decision.



Dubai has a diverse population predominantly comprising of expats. In a market where expatriate visas are linked to work, the risk associated with employment uncertainty makes renting a risk-free option than buying. Also, unlike the other developed and emerging countries which offer permanent residency, the duration of stay in Dubai is limited to the contracting period which inadvertently shortens their stay. These factors have a detrimental effect constraining the individuals to rent than buy.

However, the recent initiatives by the government have been in favour of people who wishes to stay in the country for a longer duration with visa security. The UAE government has recently announced multiple new visa reforms over the past few months. Some of them are remote work visas that can be used by professionals to reside in the UAE as they connect to work abroad through virtual mediums, multiple-entry tourist visas open to all nationalities. The government also announced a law that would grant Emirati citizenship to select foreign expats like Investors, Scientists, Doctors, Engineers, Artists, and Authors. The other reforms also included students being able to sponsor their parents and also the introduction of long-term Golden Visas. The Golden visa system allows expats to live, work and study in the UAE without the need of a national sponsor and with 100 percent ownership of their business. These visas are primarily issued for a period of 5 or 10 years and are renewed automatically. These reforms invariably allow the expats to look at the option to buy rather than spending the money on renting a property.


Given the historical trend of the real estate market in Dubai, the property prices have always recovered post the crisis period. Considering the current supply and demand dynamics, there is a probability that the real estate market would not remain a buyer’s market for long.

Although there are numerous online portals available to understand the prevailing trend for investors and end-users, the volatility and uncertainty trends in the past are difficult to comprehend, especially for individuals who are new to the market. A real estate adviser who is established in the market is the fittest choice to consult to make educated choices. Experts in the field would be better equipped to analyse, research and forecast the future, which would help the individual to examine the risks and possibilities. Considering the inherent financial commitment associated, it is imperative to understand the terms, costs, and procedures before getting into a contractual engagement.


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