Dubai’s luxury villa rental market recorded strong growth in the first five months of 2026, driven by rising demand for high-end properties and higher-value rental agreements, according to new market data.
Analysis released by fäm Properties showed that the annualised value of new villa rental contracts worth more than Dhs1 million climbed 27% year-on-year to Dhs509 million between January and May, compared to Dhs400 million during the same period in 2025.
Luxury rental growth
The value of renewed villa tenancy contracts above Dhs1 million also increased by 28% to Dhs114 million, up from Dhs89 million a year earlier.
According to data from DXBinteract, transaction volumes remained largely stable, but activity shifted towards more expensive rental brackets. The Dhs2 million to Dhs3 million category saw new contracts rise by 21%, while renewals increased by 17%.
At the top end of the market, nine new annual rental contracts were signed in the Dhs5 million to Dhs10 million range, while seven contracts exceeded Dhs10 million. More than two-thirds, or 67.3%, of all agreements signed during the period were for 12 months.
Palm Jumeirah leads
Palm Jumeirah recorded the highest number of new and renewed villa rental contracts valued above Dhs1 million, making it the leading location in Dubai’s luxury rental market.
The annualised value of new contracts on Palm Jumeirah reached Dhs113 million between January and May, up 14% from Dhs99 million during the same period last year. Renewed contracts increased by 15% to Dhs37 million.
“The demand at the luxury and ultra-luxury end of the rental market has remained resilient over the last few months. Tenants at this level are not only choosing Dubai, they are prepared to pay significantly more to live here, and that sends a clear signal about the sustained confidence in this market,” said Firas Al Msaddi, CEO of fäm Properties.
Top communities
Palm Jumeirah recorded 36 new rental contracts above Dhs1 million, followed closely by Dubai Hills Estate with 35 contracts and District One Mohammed Bin Rashid City with 22.
Dubai Hills Estate posted the strongest increase in annualised rental value for new contracts, rising 37% to Dhs87 million from Dhs63 million a year earlier.
Most luxury rental transactions in the three communities were new agreements, accounting for 69% of contracts in Palm Jumeirah, 85% in Dubai Hills Estate and 63% in District One Mohammed Bin Rashid City.
tanvir@dubainewsweek.com
