The rising rental costs in Dubai are pushing up the demand for shared accommodation in the city, leading to a surge in short-to-medium rental services, a new market study revealed.
The trend is also fuelled by the globally growing popularity of co-habitation among students, digital nomads and work-relocated expats amid the surge in the shared economy, with services such as transportation, financial, food, healthcare, knowledge education and task service increasingly booming on a shared basis, estimated to have hit a whopping $150 billion worldwide in 2022.
Buy/sell, rent/lease residential &
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The ever increasing new resident arrivals is also contributing to the spike in demand for shared spaces in Dubai, as well as in the Middle East region, with the region’s market size for shared accommodation services currently estimated at about $130 million, said the study by Colife, a global rental service for stylish apartments.
Lower costs, other benefits drive demand for shared accommodations
A recent survey by Colife showed more and more people prefer to opt for co-sharing spaces in the emirate due to a variety of reasons, huge savings on rentals being the most important factor.
“As high as 72 percent of users plan to stay in Dubai for a year or more, however, not everyone can afford rent with a desired level of comfort,” the survey data showed.
The average rent price for a stylish apartment in the emirate’s preferred areas is estimated at about AED7,900, while the optimal price for surveyed users is well below AED7,000.
A higher level of users – as high as 42.5 percent – travel and live alone, meaning that many residents simply cannot afford separate accommodation, Colife said.
“The growth of the medium-term rental market in Dubai can be attributed to the rise of remote work, which allows individuals to combine work and travel, leading to a growing preference for extended stays in Dubai.
“As a result, there is an increasing demand for fully furnished apartments that require minimal setup and offer easy check-in and check-out processes,” Ilnara Muzafiarova, CEO of Colife, told Arabian Business.
“Co-living is increasingly seen as a solution to the problem of rising rentals [in Dubai], Muzafiarova said.
In addition to lower rent, co-living services offer good location and high apartment quality.
Some of the other benefits of shared spaces include free cleaning and utility services and a community of like-minded individuals.
Companies offering shared economic services mushroom in Dubai
The Colife report said the emirate is increasingly espousing the global trend for co-sharing, with shared services becoming more and more popular in the emirate.
It is also leading to mushrooming of companies – at least 80 companies in the last count – in Dubai that operate in the ‘Sharing Economy’ segment.
Lime, Tier and Circ (scooters), Byky (bicycles), Udrive and Ekar (cars), CharterClick and Xclusive Yachts (yachts and boats) are among the companies providing various shared services in Dubai.
The Cribb, Impact Hub Dubai and AstroLabs Dubai are among the ventures that operate in the co-working spaces segment.
“It shows that the city is prepared for the introduction of an increasing number of shared service solutions for transportation, equipment and accommodation,” Colife said.
The spike in shared accommodation followed the UAE introducing new personal and family laws in November 2020, allowing unmarried couples and people of opposite genders to live together under the provisions of Dubai Rental Law on shared accommodation.
The new law applies to all accommodations, including hotel rooms, houses and apartments for rent in the emirate.
According to Go-Globe, the global ‘Sharing Economy’ market is projected to reach reaching $794 billion by 2028.