Dubai's short-term rental market in the run-up to Expo 2020 – where to buy properties to short-let?

The upcoming Expo 2020 Dubai is fueling emirate's real estate market.

The Expo is just a few months away, promising to be one of the most significant events in Dubai’s modern history. The event coincides with the opening of borders and a serious global pent-up demand, so it is expected to be even bigger and more important than it would have been in 2020.

Since the beginning of 2021, the property managing company Frank Porter have noticed a steady increase in inquiries from investors wishing to buy and short-let their properties during Expo. The main question is where to buy it?

Dubai's property market offers lots of good opportunities, so investors are not starved for choice. There are multiple developer deals going on, favourable mortgage rates and flexible sellers.

As a company managing real estate in the short-term market, Frank Porter knows about the short-term rental occupancy as well as the tourism trends.

When it comes to the short-term market, location is the most important thing. But is it so? Dubai Marina, Downtown Dubai and Palm Jumeirah are still most desirable areas for tourists in Dubai. These are typical tourist destinations where the development hasn’t even stopped yet.

However, with Dubai expanding investors are no longer limited to these areas. There are options in Business Bay, Jumeirah Village Circle (JVC), Sports City, Barsha South close to the Expo site – Dubai South. All of them are currently going through a development process with malls, metro links, offices and new residential buildings.

Coronavirus pandemic has played a role in this trend, too. People had to spend more time at home in 2020 and as a result it became less important which area you live in as long as you have your space and high-speed Wi-Fi. This trend will also continue with tourists coming to work-from-home from Dubai, where they will stay in a property longer, so it needs to be more spacious and more affordable, with nice facilities.

JVC looks very promising here. There are a lot of new buildings with great facilities and new malls for all the tourist immediate needs. At the moment JVC is witnessing high occupancy and longer stays and this trend will increase as the area develops.

As for the Dubai's main touristic destinations, it’s a pretty safe bet. For instance, if you manage to purchase a property in Dubai Marina now, within walking distance to the beach, restaurants and a bonus sea view, your occupancy will exceed a yearly 85 percent for a long time after the Expo.

It is not of great importance if the building has the 'premium' value for the short-term market. The facilities need to be nice, of course, but tourists probably won't notice the difference between a 'premium' and a 'normal' building. What matters is the interior design shown in the photos, nice facilities, views and distances to important landmarks (beach, Burj Khalifa, Dubai Mall, Atlantis, Fountains, etc.). However, in some cases, even the facilities don’t matter, when you can easily buy a day beach/pool pass at any Dubai hotel.

The Expo site and the surrounding area is very interesting at the moment as well. The area is being built up fast with metro links, new roads and new buildings, also a new airport is expected. Guests are already staying in completed properties in Jebel Ali and Dubai South.

The occupancy is still low in these areas but it will increase dramatically during as well as post the Expo, as the areas come into their own. After all, the projects there are not being built solely for the Expo. With the launch of the new airport, a significant increase in tourism to these areas is anticipated. Dubai South, for example, could be a great investment opportunity beyond the Expo.

Compared to 2017, the year when Frank Porter was launched in the region, there's a notable rise in options in the residential market at the moment. An investor can make great returns in more areas now. Dubai is developing into a real metropolis with different areas and activities for all interests or budgets. If you want luxury, you have it. But if you want something more affordable, you can have it too. Thanks to this growth in choice, new investors can come into the market and make great returns on their investment using the short-term model, because there is actual tourist demand in all areas like never before.