Tourism is an incredibly profitable sector for Dubai. This Middle East Emirate is in a prime position for East-meets-West adventures, exploring the beauty of the deserts, and taking in the old souks, markets and Dubai Mall in downtown Dubai for a lavish shopping holiday.
The Dubai holiday homes market has flourished with the boom of Airbnb and other such holiday home operator services. Short-term rental properties and holiday home units make for fantastic business opportunities for property owners.
Dubai has changed its regulations regarding holiday home operations: homeowners can list their property with the Dubai Department of Tourism and Commerce Marketing (DTCM) and Dubai Economy and Tourism Department (DETD) as short-term holiday homes.
If you’re thinking of renting your property, you will need a holiday home license and permit. Trade License Zone can guide you through the entire process with our expert advice and services.
In this article, we will look at:
- Advantages of getting a holiday home license in Dubai, UAE
- Dubai Holiday Home rentals regulations
- Cost of a holiday home license in Dubai, UAE
- DTCM holiday home fees – explained
- Steps to obtain a holiday home license in Dubai, UAE
- Working with Trade License Zone
Advantages of getting a holiday home license in Dubai, UAE
The hospitality sector is thriving: Dubai welcomes 20 million visitors per year, and that number is growing. Events such as the Dubai Expo 2020 bring in an estimated 5 million more visitors per year for 2022 and beyond.
The streamlined holiday homes license and permit regulations have made it more profitable and easier for property owners to enter the holiday homes market and earn. It translates to an average of 25–30% premium for return on investment over long-term rentals in Dubai. This means that holiday homes in Dubai will increase in popularity – and bookings.
Dubai Holiday Home rentals regulations
Homeowners wishing to rent their properties as holiday homes in Dubai must apply for a holiday home license from the DTCM and DETD. These licenses and permits are renewable annually.
The regulations for holiday homes in Dubai state that licenses are granted to homeowners, and a permit is required for the property to be approved for holiday home rental.
All property owners must have insurance for their holiday homes. Most homeowners make use of holiday home operator service providers to ensure the maintenance, marketing, and bookings of their property. These operators must establish a contract with guests and charge a security deposit included in the price to protect the homeowner’s investment.
Holiday home operators are not allowed to permanently or temporarily cease renting their holiday homes during the term of their license – unless they obtain prior approval from the DTCM.
Each holiday home must be equipped with a fire extinguisher, first aid kit, prayer mat, escape plan, 100% impenetrable curtains, a telephone, safe, beds, bedding, and linen. The DETD inspectors verify these items before permits are approved.
Cost of a holiday home license in Dubai, UAE
The cost of a holiday home license in Dubai is between AED 10,000 and AED 12,000 (including the Knowledge fee of AED 10 and the Innovation fee of AED 10). As homeowner and applicant, you will also need to add in the DTCM approval fee and permit cost (calculated by the number of rooms you are renting at AED 300 per room per year), the DETD fee, and the annual fees for Dubai Municipality. If you’d like an accurate quote, please reach out to our specialist team at Trade License Zone to help you.
DTCM holiday home fees – explained
As a registered holiday home in Dubai, the DTCM levies a 10% Municipality fee on all bookings. Homeowners must also pay AED 10 for standard holiday homes and AED 15 for deluxe holiday homes per booked room per night. The DETD also enforces annual fees of AED 300 per room plus AED 70 per home listed.The DTCM annual permit fees are calculated on the property’s configuration:
- 1-bedroom homes: AED 370
- 2-bedroom homes: AED 670
- 3-bedroom homes: AED 970
- 4-bedroom homes and bigger: AED 1,270
Steps to obtain a holiday home license in Dubai, UAE
To get your holiday home license in Dubai, it is best to partner with a specialist such as Trade License Zone to help you navigate the various applications and approvals processes for a hassle-free experience. These are the steps to getting a holiday home license in Dubai, UAE.
Step 1: Partner with Trade License Zone
The first step in getting a holiday home license in Dubai is to partner with Trade License Zone. We’ll manage all aspects of your application process and guide you on the various governmental and municipal regulations.
Step 2: List your business activities
When you apply for a holiday home license in Dubai, you need to list all of the business activities on the license application forms. The DETD lists all the official business activities allowed in Dubai. Short-term rentals of holiday homes in Dubai don’t require a list of activities as long as you would for a business trade license, but you still need to list your business activities. Failure to list all your business activities in your application may result in penalties if you perform unlisted business activities. It is best to partner with a business setup specialist such as Trade License Zone to ensure your license application and business activities are aligned.
Step 3: Choose a company name
Trade License Zone will help you choose and register your event management company’s name with the UAE’s Registry Office. You can use your name in the company’s name, but you must use it in full instead of your surname or initials. The business name must adhere to the UAE’s naming policies, including that a business name cannot include any offensive or blasphemous language, nor any references to Allah or Islam.
Step 4: Procedure to get a holiday home license in Dubai, UAE
This procedure includes applying for a holiday home license:
- You will need to complete the application forms as issued by the DCTM and DETD
- A copy of the passport of the property owners
- Two colour passport-sized photos of the property owners
- Details and floorplan of the property
- Approvals from the DTCM
- A No Objection Certificate from your employer (if applicable)
Step 5: Applying for a new visa
After applying for your holiday home license in Dubai, you can apply for your visa and open your corporate bank account. Your visa may enable you to sponsor the visas of family and staff, depending on your holiday home license. Contact Trade License Zone’s expert team to help you with this critical step.
Five tips to grow your Airbnb business in Dubai
Optimize your listing: Make sure your listing is complete, accurate, and appealing to potential guests. Use high-quality photos, detailed descriptions, and clear pricing information. Highlight any unique features or amenities that set your property apart from others in the area.
Enhance your guest experience: Providing exceptional guest experiences is key to growing your Airbnb business. Ensure your property is clean, well-maintained, filled with art, healing crystals and stocked with essentials. Consider offering additional amenities such as complimentary snacks, beverages, or toiletries. Respond quickly to guest inquiries or concerns to demonstrate your commitment to their satisfaction.
Price competitively: Research the prices of comparable listings in your area to ensure you’re offering a competitive rate. Consider adjusting your pricing based on demand and seasonality. Offering discounts for longer stays can also help attract guests and increase your occupancy rate.
Utilize Airbnb’s promotional tools: Take advantage of Airbnb’s promotional tools such as discounts, specials, and featured listings. These tools can help increase your visibility and attract more guests to your property.
Leverage social media and marketing: Use social media platforms to promote your Airbnb listing and reach a wider audience. Consider investing in targeted online advertising campaigns or partnering with local businesses to promote your property. Positive reviews and word-of-mouth recommendations from satisfied guests can also help attract new bookings.
Working with Trade License Zone
Business setup in the UAE is straightforward – when you have partnered with a team of experts such as Trade License Zone. Applying for a holiday home license in Dubai can be a tricky process. When you partner with Trade License Zone, we will save you from unnecessary delays or rejections and streamline the entire process.
The experts at Trade License Zone can get started when you simply provide us with some basic documentation and a little information required for the license and permits. Then, please sit back and let our team take care of the rest. We’ll manage your holiday home license and permits, communicate with all relevant local departments and authorities and report back when your license is approved. It really is that simple.