Pros and Cons of Short-Term Rentals for Dubai Property Owners

You’ve probably heard the buzz: “Short-term rentals in Dubai earn double what long-term tenants pay.” But is it really that simple?

With nearly 10 million visitors coming in the first half of 2025 alone, Dubai’s holiday homes market is growing fast. Websites like Airbnb, Booking.com, and Vrbo let property owners turn their apartments into money-making rentals, and many landlords are interested because they could earn more money.

But things are not always so simple. Short-term rentals have clear benefits, like earning more money, being flexible, and attracting guests from all over the world. They also have real challenges, like getting more or fewer bookings at different times of the year, stricter rules, and needing to spend a lot of time looking after the property.

So before you hand over your keys or apply for a permit, let’s break down the pros and cons of short-term rentals in Dubai, and show how the right management partner can help you maximize the benefits while minimizing the risks.

The Pros of Short-Term Rentals in Dubai

1. Higher Yield Potential

The main reason landlords choose short-term rentals is the money they make. Compared to a regular lease, a holiday home can earn 20–30% more each year.

Take a 1-bedroom apartment in Dubai Marina as an example:

→ Long-term lease: AED 7,500 per month → AED 90,000 annually.
→ Short-term rental: If you rent it out for an average daily price of AED 650 and it is booked 70% of the time, you could make about AED 165,000 each year.

Even after paying for things like cleaning, utilities, and management, landlords often end up making more money.

In Downtown Dubai, a 2-bedroom apartment with a view of the Burj Khalifa could earn AED 20,000 to 25,000 each month during the busiest times on websites like Airbnb. The same apartment might only get AED 15,000 a month if rented out for the whole year. This big difference is why landlords notice.

The most important thing is how the property is taken care of. Homes that look nice, have fair prices, and offer fast help to guests usually do better than others.

2. Flexibility for Owners

Another big benefit is personal flexibility. With a short-term rental, you can use your property whenever you want, instead of being tied to a 12-month lease.

Imagine you own a villa in Palm Jumeirah. You can set aside two weeks in the year for a family gathering, enjoy weekends at your place, or even stop bookings if you want to sell and need people to come see it. This kind of flexibility is very valuable for owners who want to earn money and also use the property themselves.

3. Exposure to a Global Audience

Dubai attracts a diverse visitor mix: families from Europe, business travelers from Asia, and digital nomads from North America. Holiday homes listed on Airbnb and Booking.com give you visibility to all of them.

When you welcome guests from all over the world, you do not have to rely on just one type of visitor. For example, if fewer European tourists come in the summer, you can still get bookings from digital nomads or business travelers. Having different types of guests helps keep your income stable, unlike renting to just one person for a long time.

4. Capitalizing on Dubai’s Tourism Boom

Dubai’s tourism industry is not just staying the same, but actually growing. Because of major events, the opening of Expo City, and Vision 2031’s plan to almost double tourism’s share of the economy, more places to stay are needed quickly.

Hotels can’t meet all this new demand on their own. Holiday homes help fill the gap, especially for families and people staying longer who want more space and comfort than hotels offer. For landlords, this trend means well-kept properties are in high demand.

The Cons of Short-Term Rentals in Dubai

1. Seasonality and Demand Fluctuations

The biggest surprise for new landlords is that the money you make can go up and down a lot. From October to March, most places in Dubai are booked and prices are high. But in the summer, less than half the places might get rented if prices are not set well.

For example:

→ A JBR apartment that earns AED 18,000 in December might only make AED 8,000 in July.
→ Landlords who expect the same amount of money each month, like with long-term rentals, may worry when the slow season comes.
This is why it’s important to plan for the whole year, not just the busy months.

2. More Operational Involvement

Short-term rentals need hands-on management. Every booking means talking with guests, cleaning, giving out keys, and checking the property. Problems like guests arriving late, internet not working, or water leaks need to be fixed right away.

Unlike long-term rentals, where one person or family might stay for years, short-term rentals can have more than 50 different groups in a year. Without the right tools and help, this much work can be too much for landlords.

3. Regulatory Requirements

→ Dubai regulates holiday homes closely. To operate legally, owners must:
Get a holiday home license from DET (costs about AED 300 for each bedroom).
→ Choose if your property is Standard or Deluxe.
→ Collect and pay the Tourism Dirham fee (AED 10–15 for each bedroom per night).

If you do not follow the rules, you could be fined or taken off rental websites. These rules help keep guests safe and protect Dubai’s tourism reputation, but they can make things harder for landlords who are not familiar with the process.

4. Upfront and Ongoing Costs

Unlike renting for a long time, you need to completely set up your place for guests. This means adding furniture, sheets, decorations, kitchen items, and sometimes things like smart locks.

Setting up a one-bedroom place can cost AED 30,000 to 50,000, depending on how you decorate it. You also have regular costs like cleaning, repairs, bills, insurance, and fees for using booking websites, so you need to spend money before you start making any.

5. Reputation Management

Guest reviews are extremely important for short-term rentals. If a place is not clean, if replies are slow, or if things are not fixed quickly, ratings can drop fast. Because sites like Airbnb use reviews to help decide which listings people see, your reputation affects how many people find and book your place.

Long-term rentals do not face the same ongoing public attention. People who rent out holiday homes need to act like hotel managers and make sure guests always have a good stay.

How OPS Balances the Pros and Cons

At One Perfect Stay, we see both sides clearly. Short-term rentals in Dubai are powerful wealth-building tools, but only when managed strategically, with a short-term rental management company.

Here’s how we help landlords maximize the pros and minimize the cons:

→ Making More Money: We use smart pricing tools and local knowledge to help you earn more and avoid times when bookings are slow.
→ Taking Care of Everything: We talk to guests and fix problems at any time, so owners do not have to worry about Following the Rules: We handle all the permits and payments you need, so you always follow the rules. Allow the rules.
→ Making Your Place Look Great: Well-designed spaces help you charge more per night and keep your place booked.
→ Protecting Your Good Name: By keeping quality high and solving problems quickly, we help you get great reviews and stay easy to find online.

By partnering with OPS, property owners enjoy the upside of short-term rentals, without the stress that often comes with self-management.

FAQs About Short-Term Rentals in Dubai

Is short-term rental profitable in Dubai?

Yes, especially in popular areas like Dubai Marina, Downtown, and Palm Jumeirah. You can earn 20–30% more than with long-term rentals, but how much you make depends on the time of year, the condition of your property, and how well it is managed.

Do I need a license to operate a holiday home?

Yes. Every short-term rental must be registered with the Department of Economy and Tourism (DET) and hold a valid permit.

What are the main costs involved?

You will need to pay for things like permits, furniture, cleaning, repairs, bills, website fees, and insurance. These costs are covered by the extra money you can make, but you should plan for them.

How do I attract guests over hotels?

Highlight what hotels do not offer: more room, privacy, a kitchen, laundry, and the chance to feel like a local. Making your place look nice and giving good service to guests also helps.

Can I manage a short-term rental myself?

You can, but it takes a lot of time. Many owners hire a company to look after their property so they follow the rules, make more money, and keep guests happy.

Final Thoughts

Short-term rentals in Dubai offer many opportunities, but they can also be complicated. The good points are strong: you can earn more money, have more choices, and reach the city’s growing number of tourists. The downsides are real: business can change with the seasons, running things takes work, and there are rules you have to follow.

What matters most is how you handle them. With the right tools, or even better, the right company to help you, you can get the benefits and avoid the problems.

At OPS, we are known for helping property owners do this. By making sure your property fits what people are looking for and is managed well, we make short-term rentals a reliable and valuable part of your investment.

Short-term rentals can deliver high yields — but only with the right strategy. Let OPS show you how to maximize returns while minimizing risks. Book your property review now.