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Why some Dubai tenants will move to bigger homes this year
Dubai’s Flexi Rent scheme could push tenants towards larger homes as the initiative will ease the cash flow burden of annual contracts for residents
- PUBLISHED: Thu 20 Aug 2026, 10:16 AM
Some tenants in Dubai will be able to move to larger apartments or town houses, thanks to the new Flexi Rent initiative which will allow residents to choose monthly, quarterly or annual rental payment plans.
According to senior real estate executives, Flexi Rent initiative will ease the cash flow burden of annual contracts, though they stressed this would not represent a major shift in overall affordability across the market.
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In June, the Dubai Land Department (DLD) launched Flexi Rent to allow tenants renting through participating real estate companies to choose monthly, quarterly or annual payment plans, helping to ease upfront financial commitments.
It is expected that the Flexi Rent initiative will be rolled out soon this year.
Farooq Syed, CEO of Springfield Properties, said tenants who had previously rented one-bedroom units might now be able to afford two- or three-bedroom homes, or even townhouses.
However, he pointed out that the total annual rent commitment remains unchanged under the scheme, meaning affordability itself is not significantly altered – only the cash flow burden is eased.
“There might be a result in slightly higher demand for large units,” he said, adding that actual rent levels would remain the primary driver of demand.
According to Morgan’s International Realty figures,
Dubai recorded 115,992 rental transactions worth Dh10.18 billion during the second quarter of 2026 as volume declined 19 per cent quarter-on-quarter, while total rental value fell 18 per cent. New contracts declined 15 per cent to 42,100, while renewals fell 20 per cent to 73,892.
Data showed that median rental pricing declined seven per cent to Dh93 per sqft. Renewals still represented approximately 64 per cent of rental activity, indicating that most recorded transactions continued to come from existing residents remaining in their current properties.
Landlords to benefit
Rohit Bachani, co-founder of Merlin Real Estate, took a stronger view, saying the biggest constraint on tenants trading up in Dubai has rarely been annual affordability, but rather the size of the individual cheque required upfront.
“A couple expecting their second child can usually service a two-bedroom on a monthly basis; what stops them is assembling forty or fifty thousand dirhams extra in a single moment,” he said.
He expects to see movement from studios to one-bedroom units, from one-bedrooms to two-bedrooms, and from apartments to townhouses in communities such as Town Square, The Valley, Damac Hills 2 and Dubai South.
Landlords of larger units, who have faced slower leasing activity amid a softening market, stand to benefit the most from this shift, he added.
Bachani cautioned, however, that affordability checks would still apply under the scheme, noting that flexibility of payment is not the same as capacity to pay.
