Holiday homes an option But…
- By admin
- October 31, 2019
By Mahmoud Elburai
Dubai opened up its holiday homes market to welcome Expo visitors in 2020. Private homeowners can apply for a holiday home permit and start leasing their properties directly but also holiday homes operators can do so on behalf of owners. Currently 2% of Dubai properties are listed on Airbnb, which is higher than an average of 0.5% of cities like Singapore and London. This shows that Dubai is an increasingly important tourist destination. But it also means that hotel industry will face tough times trying to compete with this increasingly interesting sector.
Although DTCM provided a system for registering tenants, this opened up the market for some irresponsible firms. The practice of the market now is a rent contract between the owner of the unit and holiday homes management company where the property is leased for one year to holiday homes operator. The operator is supposed to lease it for short term to visitors who wish to enjoy affordable prices especially in strategic locations of the city. Few companies misused the system and leased out these units for one-year period at very cheap prices. By giving the owner multiple cheques with no credit and cashing out customers cheques immediately, they managed to cheat several owners who found themselves forced to cancel the rent contract through rental dispute centre. Customers who rented out these properties may find themselves out as well since they do not have a rent contract in such short term arrangement. The lesson here is owners need to be careful with operators they choose and report any misconduct. Tourism department is expected to force holiday homes operators to stick to short term arrangement ideally not more than one month or so. Although holiday homes can be great option for investors to get higher yield in such low market, they can be frustrated experience if mismanaged. Moreover, privacy and pressure on Dubai communities need to be studied to plan holiday homes strategy for the city that helps to attract investors but also provide a comfortable life for residents.