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Mulki

Holiday home, or a long lease?

Nightly rates look generous until the permit, the municipality, the operator and the cleaner have been paid. This works out what each option leaves you, and the occupancy the short let needs to win.

Short letting a Dubai property earns more per night and costs a great deal more to run. A holiday home permit from the Department of Economy and Tourism, a 7% municipality fee, the tourism dirham for every bedroom every night, an operator taking 15 to 25%, and the utilities and cleaning a long tenant would have covered themselves. Put your own figures in and see which way it falls.

What the unit would let for on a normal twelve-month contract, as registered on Ejari.
AED
The average you would hold across the whole year, not your peak season rate.
AED
Nights booked as a share of the year. Well-run Dubai holiday homes tend to run 60 to 80%.
% of nights
Sets both the permit renewal and the tourism dirham, which are charged per bedroom.
rooms
Holiday home operators in Dubai typically take 15 to 25% of revenue. Set to 0 if you run it yourself.
% of revenue
On a short let these fall to you: cooling and electricity, internet, cleaning, laundry, consumables.
AED
A furnished unit has to be fitted out and replaced. Spread the cost over the years you expect it to last.
AED
Short letting is behind by
AED 15,642

AED 104,358 from the holiday home against AED 120,000 from the long lease, both after costs.

Occupancy needed to match the lease
287 nights booked a year, before the short let is worth the work.
79%
Booking revenue (255 nights)AED 178,850
Operator fee−AED 35,770
Municipality fee (7%)−AED 12,520
Tourism dirham−AED 3,832
Permit renewal−AED 370
Running costs−AED 14,000
Furnishing−AED 8,000
Net from short lettingAED 104,358
Net from the long leaseAED 120,000

A long lease pays whether you pay attention or not. A holiday home pays more only at high occupancy, and it is a small business: guests, cleaners, reviews and a permit to keep current. The first year also carries the AED 1,520 permit application and the cost of furnishing the unit outright, neither of which is in the figures above.

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What the short let owes

Charges on a Dubai holiday home that a long lease does not carry
ChargeRate
Permit application, one offAbout AED 1,520
Permit renewalAbout AED 370 per bedroom, a year
Tourism dirhamAED 10 to 20 per bedroom, per night
Municipality fee7% of short-let revenue
Operator fee15 to 25% of revenue
Utilities, internet, cleaningYours, not the guest's

Rates current at June 2026 and subject to change by the Department of Economy and Tourism and Dubai Municipality. The tourism dirham varies with the classification of the unit. Confirm your own figures before you commit.

The tourism dirham is collected from the guest rather than paid out of your own pocket, but it comes out of what the booking will bear, so it belongs in the arithmetic either way. The municipality fee and the operator fee are straightforward deductions from revenue. The costs that catch owners out are the quiet ones: cooling through a Dubai summer on a unit that is empty half of it, laundry between stays, and replacing furniture that is being used by strangers fifty times a year.

Before you furnish anything

  • Check the building rules first.

    Owners associations can prohibit short lets outright, and plenty in Dubai do. Their rules sit above your preference as the owner. This is a five-minute question to your building management and it has ended the plan for a lot of people who had already bought the sofa.

  • Price the occupancy you will hold in August.

    Dubai's short-let season is lopsided. A unit that runs at 90% from November to March can sit at 35% through the summer, and the permit, the cooling and the operator do not pause. Model the year, not the good months.

  • Decide whether you are running a business.

    Self-managing saves the operator fee, which on a AED 180,000 revenue is around AED 36,000, and costs you guest messages at midnight, cleaner scheduling and review management. That is a real job. Paying someone to do it is often the right call, but then the numbers have to work with the fee in them.

  • Check what it does to your yield, not just your income.

    Higher revenue on a unit that cost more to furnish and depreciates faster is not automatically a better investment. Run both cases through the rental yield calculator against the same property value before you decide.

Rates and rules current at June 2026 and set by the Department of Economy and Tourism, Dubai Municipality and your own owners association. General information, not licensing or financial advice. Confirm the current permit terms with the DET before you apply.

The comparison people skip

Almost every comparison of short letting against a long lease is written by someone who manages holiday homes. The honest version has to include the effort, because that is what you are really trading. A long lease is one signature, one Ejari registration and four cheques. A holiday home is a hundred and fifty check-ins.

If the calculator puts the two within a few thousand dirhams of each other, the long lease is usually the better answer, and the Decree 43 rent increase rules give you a path to raise it over time. Where the short let wins by a wide margin, and the building allows it, and you have an operator you trust, the extra work pays. Those three conditions all have to hold.

Questions

Is a holiday home more profitable than a long lease in Dubai?
Sometimes, and less often than the headline nightly rates suggest. Short letting earns more per night but carries costs a long lease does not: an operator fee of 15 to 25% of revenue, a 7% municipality fee, the tourism dirham per bedroom per night, utilities and internet that a long tenant would pay themselves, cleaning between every stay, and furnishing the unit outright. The deciding number is occupancy. Below roughly 70% on a typical one-bedroom, a long lease usually wins on both money and effort.
Do I need a licence to rent my Dubai property short term?
Yes. Any residential property offered for stays shorter than six months needs a holiday home permit from the Department of Economy and Tourism, which absorbed the former DTCM. Operating without one carries fines starting at AED 5,000, doubling for repeat offences within twelve months, up to AED 100,000.
What does a Dubai holiday home permit cost?
The initial application is around AED 1,520, and renewal runs at roughly AED 370 per bedroom per year. On top of the permit you collect the tourism dirham from guests, at AED 10 to 20 per bedroom per night depending on the classification of the unit, and pay a 7% municipality fee on short-let revenue.
Can my building stop me from short letting?
Yes, and many do. The owners association or building management can prohibit short lets in the community rules, and their position overrides your own preference as the owner. If you are a tenant rather than the owner you also need written permission from your landlord. Check the building rules before you spend anything on furnishing.
How long can one guest stay in a Dubai holiday home?
Up to 90 days per booking. Beyond six months the arrangement stops being a holiday home and becomes a tenancy, which means an Ejari registration and the protections that come with it.
What occupancy do Dubai holiday homes achieve?
A well-run unit in a strong location tends to run between 60 and 80% across the year, with the winter months carrying it and the summer thinning out badly. Use a figure you would be comfortable defending across twelve months rather than a peak-season number, because the costs run all year whether the unit is full or empty.

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