No major rent increases as Dubai’s Smart Rental Index guides hikes
When Dubai resident Jasim Mohammed clicked open an email informing him on a rent increase for his Al Quoz apartment, the new proposed rent was higher than anticipated. He has resided there for three years and seen his yearly rent increase to a hike from Dh48,000 to Dh56,700. His contract isn’t up until March 2026, but his real estate office has already written to him that there will be another rent hike, this time from Dh56,700 to Dh63,000.
Rather than try to negotiate ‘market rates’ or checking with his neighbours, Jasim did what more and more Dubai tenants are doing… He went to the Smart Rental Index offered by the Dubai Land Department. He said the result indicated that the building wasn’t eligible for a rent increase, with the amount of any increase appearing as “not applicable.”
So he replied to the real estate office with that index result. The answer came promptly: The rent was established at Dh56,700.
Since the introduction of the Smart Rental Index last year, rental negotiations are increasingly conducted with official, building-specific data, real estate experts said. The process has since become more aboveboard, with tenants deploying it to win better rents.
The new index takes a modern and robust approach to building classification, factoring in technical/structural finishes/maintenance location/spatial value services (including cleanliness and parking management It is here that we offer Investable grades for every property category in about 3,000 neighborhoods. The increases in rents are decided by the difference between a tenant’s current rent and average market rent — it ranges from 0 per cent in some cases to as high as 20 per cent.
How the rental index works
The index is being used extensively by the tenants to verify that they were not unfairly assessed, according to Niral Jhaveri, head of Property Management at Better Homes.
“For many leasehold buildings, there has been no meaningful increase or rents have stayed flat for some types of units. Now, the Rera calculator can also choose a building name and check the data on that property if eligible for any increase. This makes the evaluation process somewhat more reasonable.”
It's no longer about asking prices or assumptions, now established transactions become the driver of real pricing and fairer negotiations,” commented Karamfila Jaknouz, Head of Commercial, A1 Properties.
“Tenants are absolutely leaning on the index to take action.” “Landlords have done so, but we’ve also seen landlords factor in stability and revise or pause increases once that index showed the lower permissible adjustments.”
It’s because both landlords and tenants benefit: Tenants get clarity, landlords efficiency, and the “market benefits from long-term stability”.
And in one instance she cited, the effect was real: ‘We have had Proposed renewals (On an apartment in Dubai Marina) drop from around Dh225,000 to Dh205,000 once the rental index was used.”
She encouraged tenants to come prepared to renewal negotiations. “Check out the rental index, recent deals in your building and come into your negotiations with data rather than emotion.
“From an agent’s standpoint, it has made our job a lot more effective. We can now advise both landlords and tenants with clear, official data, which can help set expectations on both sides.”
Why the rental index matters
Shabna Ibrahim, a property manager, said tenants are more informed about their rights now. “I've been seeing many tenants receiving rent increase notices then sending their landlord a screenshot of the current rental index and therefore no actual raise,” he wrote.
Rents in Dubai are poised to keep on climbing in 2026 — at a pace of about four to six per cent in select locations — even while new supply hits the market and landlords face increased competition.
But industry experts say the Smart Rental Index is altering what those increases look like on the ground, especially for existing tenants. Although headline rental growth is expected to remain in some of the most in-demand areas, many are using official, building-level data to moderate increases at renewal and provide tenants with better clarity on what it is and isn't reasonable within their tenancy agreements.
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