News
August 24, 2025
Dubai Landlords Pivot to Holiday Homes Amid Crackdown on Illegal Partitions
In a significant shift across Dubai’s rental landscape, more landlords are moving away from traditional long-term rentals and converting their apartments into professionally managed holiday homes. This change follows a citywide enforcement crackdown targeting illegal partitions and unauthorized subletting in popular communities such as Al Rigga, Al Muraqqabat, Al Satwa, and Al Raffa.
Compliance Forces Change — Landlords Take Back Control
Recent regulatory moves by Dubai Municipality and the Dubai Land Department have targeted makeshift partitions that, while offering higher rental yields, compromise both safety and property value.
In some cases, owners have spent as much as AED45,000 to remove unauthorized modifications left behind by tenants.
But for many landlords, the real catalyst is peace of mind.
“We’ve seen more owners, especially in Dubai Marina, switching to holiday homes after tenants illegally partitioned units or refused to vacate. For many, it’s about control and peace of mind, not just profit,” says Shilpa V Mahtani, CEO of bnbme holiday homes.
She adds: “With holiday homes, you keep better possession, avoid eviction headaches, and preserve the condition of your property.”
Holiday Homes: The New Advantage
Professional holiday home management brings landlords three crucial benefits:
- Regulatory Control – Units must comply with Dubai’s holiday home permit system, meaning regular inspections and strict guest limits. This makes unauthorized partitioning nearly impossible.
- Operational Transparency – Owners have access to live calendars, verified guests, and regular housekeeping checks. Unlike standard tenancy, there are fewer surprises with occupancy or unit condition.
- Asset Protection – Frequent cleaning and professional oversight ensure better long-term maintenance and property value retention—contrasting sharply with sublets informally occupied by unrelated tenants.
Rohit Bachani, co-founder of Merlin Real Estate, highlights the shift:
“Since the enforcement drive, we’ve seen more landlords opt for professional holiday-home management or convert to serviced apartments. The logic is control. Department of Economy & Tourism permits, coupled with professional operators, allow monitored guest flow and minimal risk of ‘hidden’ subletting.”
The Financial Equation
For landlords in prime neighborhoods like Downtown, Dubai Marina, Palm Jumeirah, and Creek Harbour, holiday home returns can outpace annual leases—especially during high tourist seasons.
Yet, as Bachani points out, net returns must be balanced against operator fees, furnishing, and utility costs.
- In tourist-driven districts, a smartly managed holiday unit can outperform standard leases.
- In residential areas with lower visitor demand, traditional family rental models may still be more sustainable.
Market Impact and Looking Forward
Landlords who previously relied on high partitioned rental income are now adapting to a new environment: seeking compliant tenants or pivoting to the short-term market.
Property consultant Humaira Vaqqas notes:
“Financially stretched landlords will need time to transition, but the sector will ultimately grow more positively, with better maintained and regulated properties.”
For Dubai’s real estate future, this trend signals a market striving for safety, transparency, and higher standards—benefitting both owners and tenants alike.
Over a multi-year horizon, well-managed holiday homes, especially those diversified beyond online booking platforms, may offer superior returns and lasting peace of mind for Dubai’s property owners.
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