Holiday Homes in Dubai as an Investment Opportunity

Dubai is one of the top touristic destinations in the world. It welcomes millions of tourists annually who come to visit its beautiful places that are not found anywhere else. It is home to Burj Khalifa, the tallest man-made building in the world, Dubai Mall, the largest mall in Dubai, Dubai Fountain, one of the tallest fountains in the world, and Palm Jumeirah, the most iconic man-made islands. In addition, Dubai has many luxurious beaches and offers an amazing nightlife experience in its night bars and restaurants. With all of these major attraction points, the number of tourists continue increase year after year to the extent that Dubai welcomed close to 8.1 million international visitors in the first 7 months of 2022, which led to a major increase in demand for rental properties.

With the popularity of short-term rental websites as Airbnb, more and more tourists are choosing to stay at holiday homes during their visits instead of hotels; creating a flourishing market for holiday homes in the real estate sector. More tourists prefer holiday homes as they can rent a large place with multiple bedrooms at affordable prices, have a fully equipped kitchen and appliances like a washing machine, and can also avoid paying extra fees required in hotels such as room service. A holiday home is also a better option for families traveling together who want to share a space together instead of staying in separate hotel rooms.

With a rise in demand for holiday homes, more and more investors are looking at it as a great way to generate income. Another benefit of holiday homes is that the rental price tends to fluctuate and increase based on certain seasons and events such as Expo 2022 and New Year’s where Dubai is considered a top destination to celebrate the start of a new year.

What is a Holiday Home?

A Holiday home is any type of furnished property ranging from a studio apartment to a villa. It is rented out to tourists, visitors, and Dubai residents in order to spend their holiday there. It can be rented as a whole unit on a daily, weekly, monthly, or annual basis, and it’s managed by the Department of Tourism and Commerce Marketing (DTCM) in Dubai.

Any homeowner can convert their property into a holiday home but only based on certain conditions. One of which concerns villas. According to Dubai’s Department of Economy and Tourism (DET), only residential villas within a gated community consisting of a minimum of four villas can be converted into a holiday home, in addition to commercial villas found on main roads. Another condition is that the homeowner must get a license for his property that officially allows him to promote and list his property as a holiday home. But how does one get a holiday home license in Dubai?

Steps to Get a Holiday Home License in Dubai

In order to rent out your property as a holiday home in Dubai, you must have a holiday home license issued by DTCM.

You can apply for this license through DTCM’s website by following the next steps:

1- Create an account on the website and enter your username and password.
2- Fill in the required information about the unit, including its type, developer, area, and number of bedrooms.
3- Submit the following documents:

• Title deed or sales purchase agreement copy of the property.
• Passport copy or Emirates ID of the landlord.
• Trade license if the homeowner is a company, In addition to the Emirates ID of the authorized signatory.
• Property Management Letter which is a letter written by the new property manager to a current tenant to inform them of the changes in management. (in case the property is managed by management companies)
• Recent Dubai Electricity & Water Authority (DEWA) bill.
• Tenancy contract for the individual tenant.

4- Review your application, and submit it. It will be reviewed within one business day by DTCM.
5- If it is approved, you will receive an email confirming the approval.
6- Pay the required fees which is determined according to the size of the property.
If you want to know more information about how to obtain the license, click here.

How to Select a Property as an Investor to be used as a Holiday Home

Are you are an investor interested in purchasing a property to utilize as a holiday home as a way of generating income? If yes, then there are several points you should take into consideration to guarantee you attract the right consistent demand you would need to make the most out of your investment.

Choose a Great Location

You should choose a location that is close to Dubai’s major touristic destinations such as Downtown Dubai, Dubai Marina, Business Bay, Palm Jumeirah, and Jumeirah Beach Residence (JBR). These areas have some of the world’s most popular landmarks that attract tourists from all over the world. These locations are worth investing in.

The property should also be close to transportation services to make it easier for tourists to move from one place to the other and to be close to the other facilities such as beaches, malls, and entertainment places.

Give Attention to the Overall Appearance of your Property

Holiday homes with the highest visual appeal are typically the highest in demand when it comes to bookings. Well-designed, furnished homes with great views are major attraction factors that encourages guests to rent a particular property.

Research the Market

You should do extensive research and check similar properties in the area you have chosen in order to compare prices and the facilities offered before making your decision. You need to make sure that this property can consistently generate demand throughout the year, regardless of the season.

Seek Help from a Real Estate Agent

A real estate agent can help you choose the right holiday home in the right location and at the best price thanks to an agent’s extensive knowledge of the market and its fluctuations. An agent can guide you through the whole process to guarantee you make the most out of your investment and reach the results you want.

A holiday home is a good investment option for investors. If you want to invest in a holiday home in Dubai, contact our professional real estate agents at RE/MAX UAE who are equipped to help you in this process. Call +971 4 589 7376 or contact us here.