Why Rising Rental Pressures Are Pushing More Tenants Toward Homeownership in Dubai

The UAE’s Rental Landscape Is Changing Fast

Dubai’s rental market has always attracted long-term residents, global professionals, and families. But the balance between renting and owning is shifting. With rental rates continuing to rise across many popular communities, more tenants are taking a closer look at buying a home instead of renewing leases year after year.

Recent data from Betterhomes’ Future Living Report 2025 reveals a clear behavioural change: tenants are more motivated to transition to ownership than ever before.

Dubai Tenants Are Now More Open to Buying Homes

A Sharp Rise in Purchase Intent

The report highlights a striking jump in buying sentiment. Last year, only 25% of tenants planned to purchase a home. In 2025, that number has surged to 55%.

This shift is not just emotional, it reflects a growing preference for long-term stability, predictable costs, and the lifestyle benefits of owning.

Why Are Tenants Leaning Toward Ownership?

  • Rising annual rents: Dubai’s average rent now sits at AED 99,000, pushing residents to explore more sustainable financial paths.
  • Mortgage access: About 61% of future buyers expect to use a mortgage, indicating better lending options and a wider range of accessible property types.
  • Higher sense of permanence: Many residents are no longer viewing Dubai as a short-term stop.

All of these factors link naturally to the next trend shaping buying behaviour: long-term residency.

Longer Residency Plans Are Strengthening the Ownership Mindset

For many renters, the UAE’s stability is a major influence. According to the report, 59% of residents plan to remain in Dubai for 10 years or more, with an average expected stay of over 11 years.

When residents start thinking long-term, the appeal of homeownership grows naturally. Instead of renegotiating rent every year, they want a place that aligns with their future plans.

Long-term residency also encourages people to think about generational value and investment diversification, which brings us to the next key point.

Real Estate Investment Is Becoming a Preferred Choice

More Tenants Are Viewing Property as a Strategic Asset

The survey also found that 36% of respondents prioritize real estate as their main future investment. This preference is driven by:

  • Steady market performance
  • Strong rental yields
  • Long-term capital appreciation
  • Confidence in Dubai’s urban growth

For many residents, buying is no longer just about personal housing, it’s also a practical financial strategy.

Lifestyle Shifts Are Steering Tenants Toward Townhouses and Villas

The pandemic years reshaped how people use their homes across the UAE. The change continues in 2025. With more residents working remotely and seeking multi-use living arrangements, there is a growing shift from apartments to larger homes.

Townhouses and villas in communities such as Dubai Hills, Dubailand, and Dubai South are gaining strong interest. Tenants want more room for privacy, family life, and daily comfort, and these communities offer exactly that.

This shift complements the rising appeal of ownership—for many, the move becomes part of a larger lifestyle transition.

A Structural Shift in Dubai’s Housing Market

The Changing Market Is Not Temporary

According to the report, the shift toward ownership is not just a short-term reaction to rising rents. It reflects deeper changes in how residents plan their lives in Dubai.

Developers, banks, and policymakers are already adapting:

  • Developers are focusing on mid-market family homes.
  • Lenders are refining approval timelines and offering more flexible financing products.
  • Buyers are exploring new ownership models, such as fractional property interests.

While awareness of digital property solutions is growing—around 37% of people know about blockchain-backed fractional ownership—adoption remains low for now.

What This Means for Future Buyers in Dubai

For tenants watching rental prices increase each year, homeownership is becoming more appealing as a long-term strategy. With more choices in mortgage products, expanding communities across Dubai, and market confidence at an all-time high, many residents see this as the right moment to plan their next step.

Thinking of Buying a Home in Dubai? PSI Can Guide You

If rising rents have you exploring your options, our team at PSI can help you compare communities, understand mortgage pathways, and find properties aligned with your long-term goals.

Ready to explore homeownership in Dubai? PSI supports buyers across all budgets with updated market insights and access to the UAE’s leading residential communities. Call now.