Dubai’s luxury villa rental market has hit new heights in value over the first five months of the year, with a sharp shift towards the ultra-luxury price brackets, and the Palm Jumeirah emerging as the standout location.
Market analysis conducted by fäm Properties unveils that the annualised value of new rental contracts above AED 1m increased by 27% year-on-year to AED 509m from AED 400m between January and May 2026.
The report also illustrates that the annualised value of renewed tenancy contracts for villas above AED 1m rose by 28% to AED 114m from AED 89m over the same period.
Data from DXBinteract illustrates that while luxury rental transaction volumes remained steady, the upward shift in value was driven by more activity in higher price brackets. This trend was most visible in the AED 2m to 3m range, where new contracts increased 21% and renewals 17%.
At the ultra-luxury end, nine new annual tenancy contracts were recorded in the AED 5m to 10m band, with a further seven exceeding AED 10m. Overall, 67.3% of all contracts signed between January and May 2026 were for a 12-month duration.
Palm Jumeirah dominated both transaction volumes and annualised rental value, recording to the highest number of new and renewed contracts above AED 1m across all villa communities.
“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.”
Firas Al Msaddi, CEO, fäm Properties
The value of new contracts above AED 1m on Palm Jumeirah reached AED 113m between January and May, up 14% from AED 99m in 2025, while renewed contracts increased 15% to AED 37m from AED 32m.
The strongest growth in new contract values was recorded at Dubai Hills Estate, where annualised rental value rose 37% to AED 87m from AED 63m.
The highest volume of new rental contracts above AED 1m was 36 at Palm Jumeirah, ahead of Dubai Hills Estate at 35 and District One Mohammed Bin Rashid City at 22. Palm Jumeirah also led with 16 renewed rental contracts above AED 1m.
In each case, many rental contracts above AED 1m were new agreements – 69% at Palm Jumeirah, 85% at Dubai Hills Estate and 63% at District One MBR City.
