Dubai Tenants Swap Renewals for New Leases as Rents Drop
In a major shift for the Dubai property market, tenants are increasingly choosing to move to new properties rather than renewing their existing contracts. This trend, observed during the summer of 2026, is being driven by a significant gap between the cost of new leases and the rates offered for renewals.
A Historic Shift in Market Trends
According to an analysis of Dubai Land Department (DLD) tenancy registrations by fäm Properties, the rental landscape has changed dramatically. New lease prices for comparable units within the same buildings have plummeted by 15.3% since January. In contrast, renewal rents have seen only a marginal decrease of approximately 1%.
This development marks a turning point for the city. For the first time since January 2023, the volume of new lease contracts has surpassed the number of renewals, breaking a 36-month trend where staying put was the norm. The scale of this migration became even more apparent in recent months, with new leases exceeding renewals by 633 contracts in July 2026 and by a substantial 2,139 contracts in August 2026.
Where the Migration is Happening
Data from DXB Interact highlights that certain neighborhoods are seeing much higher movement than others. Tenants are actively migrating to new apartments in several key districts. The areas seeing the highest net gains for new leases include:
- Al Barsha South Fourth and Jumeirah Village Circle: 1,102 more new leases than renewals.
- Business Bay: 609 more new leases.
- Al Merkadh: 598 more new leases.
- Dubai Marina/Marsa Dubai: 564 more new leases.
- Downtown Dubai: 342 more new leases.
Conversely, in more budget-friendly areas such as Al Warsan First (International City), Jabal Ali First, and Nadd Hessa (Dubai Silicon Oasis), the trend remains reversed, with renewals still outpacing new leases.
Evaluating the Savings
In August, the median rent for new apartment leases settled at AED 94.6 per square foot, representing an 8.3% decline from the peak of AED 103.1 recorded in October 2025. For many, the financial incentive to move is clear. Experts suggest that tenants in prime or mid-market areas could see annual savings of between AED 10,000 and AED 20,000 on one-bedroom apartments by switching to a new lease.
"The shift is driven by cost-effectiveness. While remaining in an existing home was previously more economical, current market conditions favor switching to new apartments," said Firas Al Msaddi, founder and CEO of fäm Properties.
However, experts urge tenants to perform a thorough cost-benefit analysis. While the 15% reduction in annual rent is significant, residents must factor in the expenses associated with relocating, including agency fees, security deposits, and the costs of transferring utilities.
While the apartment market is seeing this high level of movement, the villa and townhouse segment remains distinct, with demand appearing tighter compared to the more volatile apartment sector.