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Dubai tenants renewing their leases are increasingly avoiding steep rent hikes, thanks to the growing use of the Dubai Land Department’s Smart Rental Index, which provides official, building-specific rental data.
Since its launch last year, the Smart Rental Index has reshaped rental negotiations by replacing informal “market rate” arguments with transparent, data-driven evaluations. Tenants are now relying on the index to verify whether proposed rent increases are legally permissible.
One such tenant, Jasim Mohammed, who lives in Al Quoz, experienced the impact first-hand. Over three years, his annual rent rose from Dh48,000 to Dh56,700. Ahead of his lease renewal in March 2026, he was notified of a proposed increase to Dh63,000. Instead of disputing the hike informally, he checked the Smart Rental Index, which showed that his building was not eligible for a rent increase. After sharing the official result with his real estate office, the proposed hike was withdrawn and the rent was retained at Dh56,700.
Real estate experts say such cases are becoming common. Rental discussions are now guided by verified, building-level data, making the process fairer and more transparent for both landlords and tenants.
The updated Smart Rental Index uses an advanced classification system that considers a property’s structural condition, maintenance quality, finishes, location, services such as parking and cleanliness, and overall spatial value. Rent increases are calculated based on the gap between a tenant’s current rent and the average market rent, with permissible hikes ranging from 0 to 20 per cent, depending on the category.
Niral Jhaveri, Director of Property Management at Better Homes, noted that many buildings have seen minimal or no increases under the revised system. He said the RERA calculator now allows tenants to assess permissible increases by selecting their specific building, ensuring more accurate evaluations.
Similarly, Karamfila Jaknouz, Head of Commercial at A1 Properties, explained that rental pricing is now based on registered transactions rather than assumptions. She added that landlords are increasingly revising or pausing rent hikes when the index shows lower permissible adjustments, often choosing long-term stability over vacancy.
In some cases, the impact has been significant. Jaknouz cited an example in Dubai Marina, where a proposed renewal rent dropped from Dh225,000 to Dh205,000 after applying the index.
Property manager Shabna Ibrahim said tenant awareness has increased noticeably. Many tenants now respond to rent increase notices with screenshots from the rental index, effectively challenging unjustified hikes.
While rental prices in Dubai are still expected to rise by four to six per cent in select areas in 2026, experts believe the Smart Rental Index is helping moderate increases for existing tenants and ensuring clearer, more predictable renewal negotiations across the market.
