If you have a rental property in Dubai, you may be wondering, “What are the perks of a short term rental business model vs a long term rental?”. Many assume that any rental property located in a touristy neighborhood has obvious short-term rental potential; however, that is often not the case. Below are 5 signs your property has superior earning potential as a short-term rental.
Consider the Short Term Rental Business Model
As hotels and other traditional forms of accommodation continue to saturate the Dubai market, short-term rental properties have become a much more attractive option for those looking to explore new places for a staycation, travel or business. One of the most important factors in any short term rental business model is flexibility. If you can envision your property appealing to a wide cross-section of accommodation seekers, you could be taking your first step to realizing better real estate investment returns.
5 Signs That Your Property Shows Promise in the Short Term Rental space
There are clear differences between what makes a good short-term rental vs long-term rental, there are certainly features of your property that can help you decide if yours has short-term rental potential. Below, you’ll find what are considered as positive signals that you may be sitting on a mini ‘gold mine’
1. The Right Neighborhood and the Right Building
Dubai is home to many bustling and friendly communities which appeal to wide variety of accommodation seekers. To name just a few, Downtown, DIFC, Dubai Marina, and Palm Jumeirah all have their own charm and cater to so many different sorts of lifestyles and audiences.
The location and amenities of your building significantly influence your property's potential to generate short-term income. Properties situated in central areas and offering favorable amenities can greatly enhance the experience of short-term renters. Moreover, these distinctive features serve to differentiate your property from others in the market.
Pro Tip: If you own a property in The Five Residences on Palm Jumeirah, you’ll be doing yourself a favor by contacting a reputable short-term rental operator for an earnings assessment. The earning potential can be shocking! You can always reach out to us if you'd like to know more about what areas have the best yields for Short Term.
2. The WOW Factor
In the fiercely competitive realm of Airbnb search algorithms, user engagement plays a pivotal role in driving success. Listings with 2 or 3 captivating photos that entice users to click experience a snowball effect, resulting in substantially higher returns for investors. In fact, statistics show that well-furnished Airbnb properties, boasting appealing images, tend to attract a larger number of bookings and achieve greater revenue figures compared to listings with fewer engaging visuals. Hence, investing in the presentation and furnishings of your Airbnb property can yield remarkable returns in this dynamic marketplace.
In this regard, it is instructive to highlight a very common mistake many short term rental ‘1st-timers’ make. Often, an investor will be inclined to fill a property with a hodgepodge of tattered furniture, with no cohesive interior aesthetic. After six months, they’ll conclude that short term rental ‘didn’t work’.
Pro Tip: If you’re considering short term rental, and are thinking I’ll just “give it a try with some old furniture I have”, you’d likely be better off just renting it long term, because you’re very likely setting yourself up for failure (that being said, properly outfitting a property for short let, does not require expensive furnishing - it does require a clean and cohesive design aesthetic however). We're happy to help you with the interior design for your short term rental property as well!
3. Amazing Amenities
Dubai is a location associated with luxury, top-notch amenities, and exclusivity. The city’s average apartment building features conveniences and comforts that rival those of five-star luxury resorts – think: Fitness Centers, Pools, Children's Play Areas, etc.
Accentuating amenities and highlighting the nuances that make a property standout is critical. No amenity is too small to mention, as something which seems inconsequential to you, may just be the deciding factor for a guest. The availability of a range of different amenities ensures that your property is in competition for the most number of searches.
4. Size Counts
Believe it or not, larger properties perform better in relation to smaller ones. Studios and one-bedroom properties have too much direct competition with hotels and resorts in Dubai. When it comes down to pricing and inclusions, for those smaller-sized properties, the hotels will usually make the most money here. On the other hand, larger properties that hotels can’t offer, provide the opportunity to accommodate more people in a luxury setting. Much more economical than trying to book multiple hotel rooms for upwards of ten or more people!
We're always mindful of our clients real estate investment strategies and therefore would be happy to talk through your properties earning potential and if Short Term rental makes sense for you given the market conditions in 2023
5. Having The Right Operator
Dubai, renowned for its commitment to excellence, demands accommodations that uphold the highest standards. As such, partnering with a reputable short-term apartment rental agency becomes indispensable in delivering top-tier service for your property. The management of short-term rental properties necessitates a sophisticated approach, encompassing seamless operations and exceptional customer service. Statistics reveal that properties managed by professional rental agencies witness a significant increase in occupancy rates, guest satisfaction, and overall revenue. By entrusting your property to a competent agency, you can ensure that it achieves its utmost potential in the competitive market of short-term rentals in Dubai.
It’s just simply not possible to match the sophistication on offer with hotels and resorts by managing a short term rental without an agency. More people are flooding to these well-managed high-end short term rentals in a market that exceeded half a billion AED in 2022 alone!
It’s a necessity to manage your property's pricing with AI technology that monitors current trends in holiday-stay accommodation – If you don’t have the tools of the trade working on your side, your property is just not going to deliver the returns that an investor should expect.
Short Term Rental Property Management Company
A short-term rental property management company provides the many services required to successfully manage and run your rental locations to their most optimized capacity. The right short-term rental agency can use AI-powered pricing tools and daily operational services that offer hospitality rivaling the city’s international resorts.
If you think your property matches this description, let’s chat about how we can turn out the best profits from your Dubai real estate OR share this article with someone you may know – they may just be sitting on a ‘gold mine’.
If you'd like to learn more about why the Short term rental market is set to thrive in Dubai, check out our blog post on the topic here