The Dubai Land Department initiative allows participating landlords to offer monthly, quarterly, or other flexible payment plans for annual leases.
Dubai: Dubai’s new Flexi Rent scheme could narrow the long-standing gap between short-term holiday-home rentals and traditional annual tenancy contracts by giving tenants more flexibility in how they pay their rent.
Backed by the Dubai Land Department (DLD), the initiative allows tenants renting through participating real estate companies to choose monthly, quarterly or annual payment plans. The scheme is designed to reduce the large upfront payments traditionally associated with annual leases.
Making annual rentals easier to afford
For many Dubai tenants, the challenge has not necessarily been the total annual rent, but the size of the upfront payment.
Traditionally, annual leases have often required tenants to pay in one or two large cheques. That has pushed some residents towards short-term rental contracts, even when they intended to stay in Dubai for a year or longer.
Farooq Syed, CEO of Springfield Properties, said Flexi Rent could create a middle ground between the two rental models.
“There is a big number of people that have decided to live for a year, but they just move into short-term rental contracts because they cannot pay the bigger cheques,” Syed said.
He added that these tenants could now choose an annual contract while benefiting from more manageable payment schedules.
Short-term rentals, however, are expected to remain attractive to tourists, international visitors and residents who do not want to commit to a full year.
A significant shift for Dubai’s rental market
The potential impact of Flexi Rent comes as Dubai’s rental market adjusts to increasing supply and changing tenant demand.
The emirate recorded 115,992 rental transactions worth Dh10.18 billion in the second quarter. Rental transaction volume declined 19 per cent quarter-on-quarter, while total rental value fell 18 per cent.
New contracts dropped 15 per cent to 42,100, while renewals declined 20 per cent to 73,892.
Median rental pricing also fell 7 per cent to Dh93 per square foot. Despite the decline, renewals accounted for around 64 per cent of rental activity, showing that existing residents still made up the majority of recorded transactions.
Payment flexibility could be the bigger opportunity
Rohit Bachani, co-founder of Merlin Real Estate, described the narrowing gap between annual and short-term rentals as one of the initiative’s most underestimated effects.
He said many monthly holiday-home tenants were not necessarily looking for lifestyle flexibility. Instead, they wanted payment flexibility and were willing to pay a premium to obtain it.
Under Flexi Rent, tenants can potentially get a similar monthly payment structure while remaining on a registered Ejari tenancy, with access to Smart Rental Index protections and Real Estate Regulatory Agency (RERA) recourse.
Bachani expects this could bring some demand that shifted towards short-term accommodation back into the annual rental market, particularly among mid-income professionals and young families.
Short-term rentals will still have a role
Flexi Rent is unlikely to replace Dubai’s short-term rental market.
Tourists, corporate employees on temporary assignments and genuinely transient residents will continue to value the flexibility of shorter stays.
The bigger change could come among residents who already intend to remain in Dubai for a year but have avoided annual leases because they could not afford a large upfront cheque.
For this group, the Dubai Flexi Rent scheme could make annual tenancy more accessible while giving landlords another way to attract longer-term tenants.
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Flexi Rent will offer tenants the same monthly payment rhythm within a registered Ejari tenancy, backed by Smart Rental Index protection and Rera recourse, without the added premium.
Source: KT
