Renting a property in Dubai can be an unsettling prospect, especially with the constant inspections to the property. There are a lot of things you need to consider when renting your property in Dubai, such as the rental amount but most importantly, you need to decide whether you want to rent your property for the long-term or the short-term. Then, decide if you want to manage the rental process yourself or hire a professional.
When talking about short term rentals in Dubai, this means renting a property for a short period and receiving the rent daily, weekly or monthly, as this type of rental is suitable for tourists, businessmen and visitors in general. Real estate options for short-term rental include furnished apartments and hotel apartments in Dubai.
A) Granting freedom to tenants if they wish to change the place of residence; and B) Ready for immediate housing, set to provide you with the necessary furniture and fittings. The most important point is to analyze if the property is suitable for short-term rental as not all the areas in Dubai are Touristic areas.
The cost of a short-term apartment is the same as when you are living in a property given that all the expenses shall be paid by the landlord such as DEWA, AC services and internet charges, plus the registration of the apartment in DTCM (Dubai Tourism and Commerce Marketing), and the management fees which will vary from 15% to 25% on the revenue in case you have a professional company operating the property for you.. This is compensated by a higher daily rate which covers the amount of the expense. The services normally provided for short term rentals include granting guest access to facilities within the property and in the building where applicable properties, such as swimming pools and fitness gym, are available. All properties will include a free high-speed Internet, basic TV programs and telephone, and a basic supply of bed linen, bath towels, toiletries, and toilet tissues, provided in each property upon arrival of the guest and are not changed during the stay unless ordered to do so at extra charge. The short term is subject to DTCM control. There is no occupancy guarantee as such is subject to seasonality and market situation. Reaching levels of 70% or higher is expected to get approximately 10-20% more revenue than the annual lease. Prior to making a decision unless you are 100% sure you have the right property, the best option is to contact a professional company like fäm Living www.famliving.com to assess your property and provide you with the possible short term rental scenario.
The Most frequent issue a landlord will face while managing a property it will be related to the following:
1. Finding the right tenant:
Most probably this will be handled by a broker. A broker normally works on a commission basis so finding the right tenant is not her/his priority and the landlord will not meet the tenant until the last moment
2. Negotiating Contract Terms:
The landlord might not have the experience on it to be accurate while a contract is being negotiated. It is very important to describe in a TC who is responsible to pay
3. Draft the Tenancy Contract:
There are multiple contracts in the market, you just need to read it all to find the one who suits you best, covers all the most relevant points and is up to date with the latest rules and regulations
4. Managing cheques:
Cashing the cheques on time and in case of bounced cheques do the full procedure to go to the bank collect the cheque and meet the tenant to exchange the same.
5. Manage all maintenance issue in the property:
Dealing with external vendors, book appointments, make sure the vendor reach the place on time, check different quotations, work with quality service providers, verify the job is properly done.
6. Pricing:
A proper Pricing analysis must be conducted to identify the best possible price and to rent the property in the shortest period of time. The Best price doesn’t mean the Highest, means the best according to the market circumstances to reduce the most the vacancy period
7. Keep organized records:
All the Incomes, expenses, service providers, communication with the tenant, bounced cheques, Contracts. All this is necessary in case things go wrong and you need to prove what has been discussed collect or not etc.
8. Manage the relations with building Management:
To move in and move out. Normally the tenant does it but in some cases, they need the assistance to know to whom they have to contact and avoid delays and complaints.
9. Defect and Liability period:
If your property is new and you have not done a professional snagging, manage the maintenance request with the developer or building constructor.
The market today offers the possibility to lease a property on an annual basis, furnished or unfurnished. The furnished apartments posting a higher value being based on the furniture and design. In terms of payments, due to the current situation landlords are more flexible and are accepting 6 to12 cheques. In the scenario the landlords need to use the property then a 12-month notice must be sent to the tenant to vacate the property. In case of a sale, the property can be sold with a tenant living in, in this situation the right and obligations are transferred to the Buyer.
The property is leased for a 1-year period. It could be for a longer period like 13-14 months or more than 1 Year in case of commercial properties 2- 3 years. In some cases, due to uncertainty of the market (COVID-19), some tenants request a lease between 6 to 12 months, for a lesser period Ejari cannot be done.
Annual Lease will grant a cash flow projection and even if the tenant early terminates the agreement you will be covered for an extra 2 months after the tenant vacates (if your contract covers it in a proper way) and that time can be used to find a new tenant.
At fam property management we will assist you in all the points mentioned above Plus we will take care of the tenant using the latest technology to provide the best and the fastest services in the market.
Our in house developed App Fam Fix was crafted to assist the tenants to register any maintenance issue as it happens with their mobile. The same request comes automatically to our CRM where we keep all the records related to the properties under our management. This grants the landlord transparency and clears records of the property expenses. A happy tenant is essential to keep a healthy property generating the best possible income year by year.
Last but not the least, an Investor needs to understand the difference between both concepts and know what type the investor She/He is. Once this is clear then the decision should be made. Some investors require a fixed income and the certainty of the amount to be collected posted by leasing and some others might look to maximize the net revenue willing to take some risk to achieve it which is what a short-term lease offers. For further inquires contact fäm Property management: info@manage-my-property.ae
We highly advise you to always consider a broker that will be able to assist you with any of your real estate inquiries even beyond a sale. fäm Brokers are highly trained to provide you unparalleled servicing pre-sale, during, and post-sale for a more effective real estate investment advisor or consultancy. This has allowed the company to effectively support the real estate aspirations and investment goals of its patron clients over the last 11 years.