Dubai’s rental market is in transformation. In 2025, landlords face mounting pressure as authorities intensify enforcement against illegal partitions and overcrowded apartments—particularly makeshift sub‑divisions of studios and one‑bedrooms. As these informal rentals are swept away, rents for compliant units are climbing swiftly. Here’s what every landlord, tenant, or investor should know.
1. Enforcement Surge: How Dubai Is Tackling Illegal Partitions
Dubai Municipality, in collaboration with the Dubai Land Department and Civil Defense, has launched a widespread inspection campaign across dense neighbourhoods such as Deira, Al Riqqa, Al Satwa, Al Barsha, and Al Raffa. According to a report by Khaleej Times, makeshift walls, bunk beds, and subdivided layouts—often rented at AED 600–800/month—are being removed for violating building codes and fire safety regulations.
The same report states that authorities issued formal warnings before inspections to raise awareness among landlords and tenants. Many properties were ordered to be restored to their original layouts. Landlords found in breach face penalties of up to AED 50,000, along with immediate utility disconnections or enforced evictions in cases of repeat violations.
2. Safety Risks Behind the Crackdown
Illegal partitions aren’t just legal issues—they are genuine safety hazards. Sub‑standard walls block emergency exits, disable smoke detectors, overload electrical circuits, and make evacuation extremely difficult during emergencies. High-rise fires in the past have exposed the risks in overcrowded buildings, prompting stricter enforcement and tenant safety prioritization.
3. Real Impacts: Affordability vs Safety
Partitioned bedsits, often advertised at AED 600 to 1,200/month, have historically been an option for low‑income expatriates earning modest wages. However, these setups typically involve tiny, unsafe spaces with bunk beds squeezed into converted storage rooms or kitchens.
With the crackdown in effect, many displaced tenants are relocating to neighbouring emirates like Sharjah, where rent is lower. But this shift comes at the cost of long daily commutes, increased transportation expenses, and separation from community networks in Dubai.
4. Market Adjustment: Why Studio and One‑Bed Rents Are Rising
As low-cost, illegal rental options disappear, demand is shifting to compliant studio and one-bedroom apartments. This demand shift is creating a tighter supply in the regulated market, pushing rents upward. Recent market data from early 2025 reveals:
- Studios in Dubai Marina: Approx. AED 70,000/year
- 1-Bedroom in Downtown Dubai: Approx. AED 120,000/year
- Studios in Palm Jumeirah: Approx. AED 92,500/year
- 1-Bedroom in Palm Jumeirah: Approx. AED 160,000/year
Rental demand—particularly from professionals and expatriates—is pushing long-term leases up by over 13%, with short-term rentals rising by 18% as well.
5. Transparency & Regulation: RERA’s Smart Rental Index
To modernize rental governance, Dubai’s Real Estate Regulatory Agency (RERA) introduced the Smart Rental Index—a real-time system that provides rental valuations based on property features, location, amenities, and condition.
The updated rent increase policy includes:
- No increase if the current rent is within 10% of the official market value.
- Up to 20% increase if the current rent is 40% below market value.
All rent increase notifications must be issued at least 90 days before the end of a lease term. These rules aim to protect tenants, prevent exploitation, and encourage landlords to upgrade their properties while complying with legal boundaries.
6. What Boosting Properties Clients Should Know
For Landlords & Investors:
- Stay compliant: Avoid illegal modifications, register all tenants through Ejari, and get approval for changes.
- Use the Smart Rental Index: Justify controlled and transparent rent increases.
- Shift your leasing strategy: Many landlords are moving away from bachelor-only accommodations to families or corporate tenants to ensure long-term compliance and fewer maintenance issues.
For Tenants (Especially Budget-Conscious or Migrant Workers):
- Avoid partitioned rentals: These are unsafe and now increasingly illegal.
- Check your lease: Ensure you are officially registered on Ejari, or you risk eviction without compensation.
- Consider legal alternatives: Employer-sponsored staff housing, co-living, or budget studio developments offer safety and stability without legal risk.
For Market Analysts & Property Managers:
- The elimination of illegal units is shifting demand to compliant housing.
- Mid-range segment pressure is rising—presenting investment opportunities in micro-housing, co-living spaces, and affordably priced family units.
7. Longer-Term Outlook: Balancing Affordability and Safety
Dubai’s authorities now face the complex challenge of removing hazardous, informal housing while ensuring there are enough legal, affordable options for its growing population. Industry experts suggest:
- Subsidized housing for workers earning under AED 2,000/month
- Purpose-built co-living developments regulated for safety and hygiene
- Developer mandates for mixed-income housing in new masterplans
- Improved transportation from outer zones to reduce commute times for those priced out of the city center
Final Thoughts from Boosting Properties
At Boosting Properties, we believe that a transparent, safe, and legally compliant rental market is essential for long-term growth in Dubai’s real estate sector. As regulations become stricter and enforcement increases, it’s more important than ever for landlords, tenants, and investors to work with experienced professionals who understand the evolving rules and market dynamics.
Whether you’re seeking a new investment property, looking to lease your apartment, or need assistance navigating Ejari registration and rental valuations—our expert team is here to help.
Let’s build a safer, stronger rental market in Dubai—together.
