Becoming a landlord in Dubai: a first year checklist

Letting a Dubai property for the first time is mostly administrative, and the administration is what new landlords underestimate. The tenant is the easy part. The permits, the registrations, the notice deadlines and the real net yield are where first year landlords get caught.

Here is the sequence, in the order it actually happens.

Before you advertise

Confirm the property is legally lettable. Check the title deed and the master community rules. Some communities restrict short term letting entirely, and some restrict sharing. If short term letting is the plan, that is a licensed activity and a different route again.

Get the unit ready. Deep clean, service the air conditioning, fix what is broken. A property that shows badly rents for less and rents slower, and the gap is usually larger than the cost of fixing it.

Set the rent against the RERA index, not against portal asking prices. The index is what will govern your future increases, so starting badly positioned constrains you for years. Our guide to RERA rental increase rules explains how the calculation works.

Understand the permit rule. Every property advertisement in Dubai needs a valid Trakheesi permit number displayed, and the advertisement has to match the real unit. This is a legal requirement, not a formality. Our note on Trakheesi permits explains what a compliant listing looks like.

Signing the tenant

• Check the tenant. Passport, visa, Emirates ID, employment or trade licence. Verify rather than assume.
• Use a proper tenancy contract covering term, rent, payment schedule, the maintenance threshold and the notice provisions. Our note on landlord responsibilities covers the maintenance split.
• Take the deposit. Typically 5 per cent of annual rent unfurnished, around 10 per cent furnished. See our note on security deposits.
• Do a dated condition report with photographs, signed by both parties. This single step prevents most end of tenancy disputes.
• Register Ejari. It is required, and without it neither party can bring a rental case. Our guide to applying for Ejari covers the process.
• Hand over the DEWA and chiller accounts properly. See our note on DEWA, chiller and move in costs.

During the year

Respond to maintenance in writing and quickly, even when the item falls to the tenant. Keep every invoice. Keep the air conditioning servicing record. Diarise the 90 day mark before the renewal date, because that is your deadline for a rent increase notice, and missing it means the rent stays where it is for another year.

If you might want the property back, the notice period is 12 months and it has to be notarised. Our guide to eviction notice rules sets out what a valid notice requires.

Working out your real net yield

This is where first year landlords are most often disappointed, because the gross figure they modelled and the money that actually arrives are different numbers. Deduct all of the following from the annual rent:

• Service charges to the building or master community.
• Agency letting commission, typically 5 per cent of annual rent.
• Management fee if you use one, typically 5 per cent.
• Maintenance and air conditioning servicing.
• Void periods between tenancies.
• Mortgage interest if the property is financed.

A property advertised as producing an 8 per cent gross yield often nets 5 to 6 per cent once those are taken off. That is still a reasonable return, but it should be the number you plan around. Our guide to rental yield in Dubai covers where gross yields actually sit by area.

Renewal, and the decision that follows

Ninety days before the anniversary, decide. Renew at the same rent, propose an increase within the permitted range, or serve notice. Each of those has a different deadline and a different document, and the decision is much easier when you have kept the maintenance record and know what comparable units are achieving.

Our guide to renewing a tenancy contract in Dubai covers the process from both sides.

Should you self manage

If you live in Dubai, hold one property, and have time, self managing is entirely reasonable. If you are overseas, hold several units, or simply do not want the calls, a managing agent handles the letting, the Ejari, the maintenance and the renewal cycle for a percentage of the rent. Our property management service sets out what that covers, and you can talk to us about a specific property.

Frequently asked questions

What do I need to rent out my property in Dubai?

A lettable property under the community rules, a proper tenancy contract, a security deposit, a registered Ejari, and a valid Trakheesi permit number on any advertisement. You also need the DEWA and chiller accounts transferred correctly and a dated condition report signed by both parties at move in.

How much commission does an agent charge to let a property in Dubai?

Letting commission is typically 5 per cent of the annual rent, paid once when the tenancy is signed. Ongoing property management, which covers maintenance, renewals and tenant handling through the year, is usually charged separately at around 5 per cent of the rent.

What is a realistic net rental yield in Dubai?

After service charges, letting commission, management fees, maintenance and void periods, a property advertised at an 8 per cent gross yield commonly nets somewhere between 5 and 6 per cent. Mortgage interest reduces it further where the property is financed. Model the net figure rather than the gross one before you buy.

When do I have to notify a tenant about a rent increase?

At least 90 days before the renewal date, unless the tenancy contract specifies a longer period. Missing that deadline means the rent stays as it is for another year, so diarise it well in advance. The increase itself has to fall within the range the RERA calculator permits for that property.

Do I need Ejari as a landlord?

Yes. Ejari registration is required for tenancies in Dubai, and neither a landlord nor a tenant can bring a case to the Rental Dispute Centre without it. It also underpins the tenant's DEWA connection, so it is in the landlord's interest to make sure it is actually completed rather than assumed.

Can I let my Dubai property on a short term basis?

Only with the appropriate licence and where the master community permits it, as short term or holiday home letting is a separately regulated activity rather than an ordinary tenancy. Check the community rules before committing to that model, because several Dubai communities restrict or prohibit it outright.