The real estate market in Dubai has not been new to the global investors, however, over the recent years short-term rentals have emerged as one of the fastest growing trends in the city. As Airbnb, Booking.com, and others are flourishing, a large number of property owners are transforming their apartments into holiday homes to get worse returns.
Nevertheless, is Airbnb a smart investment plan in 2025? Let’s break it down.
The Short-Term Rental Popularity in Dubai.
The short-term rental market in Dubai has been developing continuously since the Department of Economy and Tourism (DET) gave individuals the opportunity to register their houses as holiday rentals.
These numbers tell the story:
- An upward of 12 million visitors came to Dubai in the first half of 2025.
- Short-term rentals are occupying more than 75 percent of their capacity in such prime locations as the Dubai Marina, Downtown, and Business Bay.
- Investors are recording 20-30 percent higher returns per year than long-term leases in other similar properties.
In a word-of-mouth the demand is high, the returns are real and short term rentals are a lucrative venture considering the image that Dubai is a worldwide tourist destination.
The appeal of Airbnb Investments
Increased Rental Yields: The short-term stays of the properties enable the owners to dynamically adjust prices in order to earn the most money during seasonal and event periods.
Flexibility: The owners are able to alternate between the short-term and the long-term rentals based on the demand of the market.
Global Reach: Airbnb connects your property with millions of traveling people who want to experience the local life of the place particularly in cities.
Government Support: Government regulations in Dubai have established short-term rentals as a licensable business, thereby giving it credibility and investor confidence.
But… It’s Not All Smooth Sailing
Investments in Airbnb can be fruitful – but not in cases of poor management. Some key challenges include:
License and Compliance Costs: Before you are allowed to list your property, you need to have a DET holiday home permit, building management approval and safety standards.
Maintaining & Guest Turnover: Short-term rental properties will need the hotel-like maintenance, including routine cleaning, furnishing replacement, and professional management.
Seasonal Demand: Low seasonality may result in a downturn in occupancy of the hotel and have a direct impact on ROI.
Competition: Thousands of listings in Dubai will make a difference between those who stand out and those who do not, and the main focus will be on the strategic pricing, the great reviews, and the strong location.
Will Airbnb Still Be a Good Investment in 2025?
The brief response: Yes – when it is done correctly.
As long as you:
- Invest in the best location with established demand.
- Be in adherence to DET regulations.
- Ensure constant quality of the property and service to the guests.
- Price strategically with market-driven information.
Short-term rentals remain to be a smart, future-proven strategy to investors who want the flexibility, higher returns, and access to the growing tourism industry of Dubai.
We help investors with all the stages of the short-term rental process, including the property choice and licensing, furnishing, and management. Regardless of whether it is your first investment property or you are adding to your Airbnb portfolio, our experts will assist you:
- Establish areas that do well in short term leasing.
- Predict ROI and occupancy rates.
- Take care of property formation and licensing with DET.
- Introduce you to professional operators to manage the daily management of the guests.
Contact Keyestone Real Estate and discuss the most lucrative Airbnb investment options in Dubai.
- Website: www.ksgre.ae
- Call: +971 52 984 7151
Join our team: hr@ksgre.ae
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