Global عربي
KSA عربي
Global عربي
Suppose you are a property investor in Dubai, one of the hottest property markets in the Middle East because of the tax advantages in the city, stable economy and strong rental returns.
During H1 in 2024 alone, there were more than 1 million rental transactions through the Dubai Land Department at a value of AED 74.5 billion, which shows how much the Dubai rental market is active and competitive.
The high demand and increased rents in other areas are causing individuals, especially most of the expatriates, to consider means of minimizing their housing expenses.
In the UAE, you need to decide whether to take a house on a direct rent or a sublease. Initially, both might seem like comparable options but the reality is very different and dangerous.
Most individuals are not aware that subleasing in Dubai without a written license or the consent of the landlord is strictly prohibited.
Under the rental law in Dubai (Law No. 26 of 2007, Amendment Law 33 of 2008), this may lead to critical consequences such as eviction or legal penalties. As there are numerous cases, which both tenants and subtenants lose money or are taken to court.
This blog is going to describe;
- What is subleasing and renting in Dubai?
- What is the law about?
- What can you do to be secure or keep your investment safe?
As an investor or an advisor to an investor, this guide will assist you in making smart and legitimate decisions.
Read more about: UAE Golden Visa – Frequently Asked Questions For Investors
Direct renting is when the tenants rent a property directly without involving a real estate agent on behalf of the landlord. This kind of renting is available on portals like Property Finder and Bayut, under labels like “direct with the owner”, and it means that tenants are interacting with the owner on matters concerning rent, contract, property condition and payments.
Did you know that in H1 2025, the average price of a 1-bedroom rent in Dubai Marina was AED 111,000/year, increased by 0.24% in comparison with H2 2024, Business Bay - AED 110,000/year increased by 5.52% and JVC - AED 78,000/year increased by 4.14%.
- No Agent Commission Costs
The direct renting doesn’t necessitate an agent, and they typically charge 2 to 5% commission of the annual rent that you will save on renting it directly. On an AED 100,000/ per annum lease, that’s money saved of AED 2,000 - 5,000.
- Faster Negotiation
There is no middleman, so you negotiate the rent, monthly payment and the repair responsibilities directly with the landlord.
- Additional Burden on the Tenant
In the absence of an agent, tenants have to prepare the contract, ensure to verify the landlord’s credentials and register everything on their own like tenancy, establish utilities to themselves with the Ejari system (managed by the Real Estate Regulatory Agency) and DEWA (Dubai Electricity and Water Authority).
- Finding the Properties
You can source these listings through various online platforms such as Property Finder & Bayut, any social media groups, or you can reach out to owners of the property directly in your desired location.
- Compulsory Charges
In case the tenants prefer direct renting, they will have to pay Ejari Registration fees, roughly around 100 to 200 AED, DEWA deposit, which roughly equals 2,000 AED and the 5% housing fee that is collected on their DEWA bills monthly.
- Potential Cost Savings
The main advantage of direct renting is that you get the chance to save an agency fee that used to be seriously expensive in the Dubai rental market.
Even in Dubai, it’s called subletting, but it is not as popular as subleasing. It is a situation where a tenant who has already rented a property, but another subtenant lives in those premises and rents all or only a portion of the property.
In subleasing, the landlord still considers the first tenant as the primary tenant, and the tenant is still legally responsible toward the landlord, but the subtenant lives there and pays you.
Suppose a unit is rented out to you at AED 6,000/month, but you pay 3 months up front, AED 18,000, you will lose all this in case the main tenant declines to pay the rent. The filing fees to RERA (Real Estate Regulatory Agency) begin at AED 300, although subtenants who are not registered with Ejari may not be allowed to file it.
1- Sublease Agreement
Make sure you outline a formal sublease agreement that will include the contract between the sub-tenant and the tenant.
2- Causes of Subleasing
The reasons that drive tenants to sublease could be financial constraints, failure to occupy the property to the end of the lease period or other personal reasons.
3- Written permission of landlord
According to Article 24 of Law No. 26 of 2007, the original tenant is required to obtain the landlord's written consent with regard to subletting. But under Article 25, when the subleasing is not based on the landlord's permission, then that is a breach of contract and may lead to an eviction even if the subtenant was paying the rent, since it is not according to the tenant contract.
4- Subtenant rights are protected
In a case where the sublease is legal and approved, the subtenant obtains the same rights as the tenant with the main lease to claim compensation.
The main guest is the original tenant and has the original lease with the landlord.
When the tenant decides to sublease, they are allowed to sublease the whole house or a room to a subtenant.
The subtenant would pay his rent to the main tenant, who remains responsible for paying the landlord according to the contract that has been registered under Ejari.
A sublease agreement should be signed by all parties: the landlord, the tenant, and the subtenant and the landlord should keep their written consent under RERA and DLD regulations.
Yes, Subleasing in Dubai is legal, but you have to make sure you do it in the right way. The tenants are required to obtain written consent from the landlord in case some part of the property is to be sublet. In the absence of such consent, subleasing is said to be a breach of the tenancy agreement.
In one real case, a subtenant at Jumeirah Village City (JVC) was thrown out of his apartment when the main tenant missed rent. Although the subtenant had initially paid AED 18,000, but he lacked Ejari and landlord approval. The subtenant was not able to make a case with RERA since it was not directly leased.
A tenant may sublet property under conditions of Dubai Law No. 26 of 2007, which includes the written consent of the landlord, amended by the Law No. 33 of 2008, which prohibits any subleasing of residential accommodation without the written consent of the landlord,
but does not apply to non-residential property and does not establish the formalities of consent required in section 26 to be written. Under Article 24, it is explicitly mentioned that you should obtain permission first. This is monitored by RERA and the DLD with the use of the Ejari agreement and other systems.
When you sublease without the permission of the landlord:
1- The landlord can evict the main tenant and the subtenant at once, even in the middle of the contract.
2- The landlord can seek monetary damages from the tenant for the violation of the lease agreement.
3 - The service providers can terminate utilities, as Ejari will not acknowledge an unauthorized sublease.
To receive legal consent to subleasing, one has to comply with the following steps;
1- You need to check your lease contract for any subletting provision.
2-Obtain a written landlord permission, and it is preferably included as an Ejari-approved rider or a separate agreement of a sublease.
3 - The sublease must be registered in Ejari with the landlord’s consent, as well as the regulations of the sublease.
4 - Make DEWA and utility providers aware of the subtenant such that services are not terminated.
No, the subtenant cannot register an independent Ejari in his name because of the law, and it says that;
According to DLD and RERA, Ejari is not done on any basis other than the initial tenancy agreement between The landlord & The main tenant.
Ejari is generally associated with the landlord and tenant relationship. In that case, subtenants have no legal rights unless the landlord consents to cancel the original lease and enter into another with the subtenant.
The utility providers, such as DEWA, need to have an Ejari certificate in the name of the tenant. So, in this case, you cannot apply to the utilities on your own unless you are a registered tenant.
When written consent is given by the landlord and the agreement is re-issued to the subtenant, the subtenant then becomes the new main tenant and may register Ejari in his name. This can hardly be done, and it involves cancellation of the first lease.
1- Register with the Dubai REST application or visit a typing centre licensed by the Dubai Land Department.
2- Upload the required document, including your tenancy contract, Emirates ID, landlord’s passport copy, title deed & DEWA bill.
3- The payment of Ejari fees will be approximately AED 220.
4- Access your Ejari certificate via the app or email. This will show that a licensed lease is legally registered.
Renting means that you enter into a housing contract with the landlord. The tenant becomes officially registered by the Ejari, and this makes your tenancy valid, first personally, and second, in terms of rights and responsibilities.
Subleasing implies you’re sub-renting with a leaseholder, and you’re a subtenant but don’t have a direct contract with the landlord.
In the case of renting, the legal protection is stronger. Your contract is recorded in Ejari in your name and thus in the case of any problems, you can file a case in RERA or the Rental Disputes Centre.
The protection provided by subleasing is weaker, and also, you don’t have your agreement, but you are linked with the main lease, so in the case of termination of the contract, your sublease is also over. The claim cannot be filed against the landlord directly, but only against the tenant to recover compensation.
Renting in Dubai
Pros:
- You end up having a direct contract with the landlord registered under your name through Ejari.
- Your rights are well covered by RERA and you can refer disputes to the Rental Disputes Centre.
- These utility accounts, such as the DEWA, can be established under your name.
Cons:
- You may need to pay an agency fee (usually 2–5% of annual rent).
- Tenants will have to deal with contract paperwork, Ejari registration and DEWA setup.
- There are housing fees of 5% of annual rent, which are paid monthly through DEWA.
Subleasing in Dubai
Pros:
- In some cases there can be cheaper rent, especially in shared areas or temporary residences.
- You can have flexible lease rates, which are better than regular 12-month rental agreements.
- In many cases, you will not be charge any agent commission, and the full deposit will also not be required.
Cons:
- There is no direct leasing agreement with the landlord, and less protection in the law in the event of a dispute.
- In the case of lease cancellation by the main tenant, your sublease is declared invalid.
- The subtenants usually cannot register Ejari or open a DEWA account in their name.
Not sure which to choose? Ask yourself
- Are you planning to live in Dubai longer than 6 months? → It is safer to rent.
- Do you require DEWA under your name? → Go with direct renting.
- Is saving cost the priority over legal protection? → Subleasing might be considered as an option with the consent of the landlord.
- Do not want legal risk? → then always request Ejari.
1- Who pays DEWA in a sublease?
When a sublease is signed, the DEWA bill is typically paid by the subtenant, but it has no legal effect as the main tenant is legally responsible since the original Ejari continues to bear their name against the landlord and DEWA.
2- Do landlords allow subletting in Dubai Marina / Business Bay / JVC?
It all depends on the lease agreement and the rules of the landlord. Most of the landlords in these areas, like Dubai Marina, Business Bay and JVC, do not allow sub-leasing in plain words unless they specifically grant you written approval. It is best to read your contract or enquire with the landlord directly.
3- Can companies sublease office spaces in Dubai?
Yes, but that depends on the area and rules about licensing. In the mainland Dubai, the company can sublease its office space only when the landlord has provided written permission and the DLD permits through a revise tenancy contract or sublease agreement.
The subleasing firm shall also have to renew its Ejari and possibly adjust its trade license to include the shared office.
The permission to sublease is only given under the freezone authority that provides an office sharing permit in areas such as DMCC, DAFZA or TECOM. For instance, DMCC specifically states that “companies can surrender/sublease their space,
but they have to make sure to submit the documents and receive approval”. A breach of this law can lead to license penalties or lease termination.
4- Who is responsible for damages in a sublease?
All the repairs and damages that have occurred due to the existing original contract remain the responsibility of the main tenant. The subtenant might be responsible to the main tenant; however, the enforcement between the landlords remains against the main tenant.
5- Can you sublease a property in freehold or leasehold areas?
Yes, it is possible to sublease in both freehold and leasehold zones in Dubai, though with the written consent of the property owner.
The law regarding the right to sublease is based on the terms in the rental contracts and the compliance with Dubai Law No. 26 of 2007, and not the property being in a freehold or leasehold zone.
The most important thing is the consent of the landlord and the act of applying to register the sublease, without which the sublease is considered unlawful, regardless of what kind of property it is.
This is the case for communities like Dubai Marina (freehold) and Al Warqaa (leasehold), where in both instances, landlord approval and documentation are necessary.
Disclamer:
This post is for educational purposes only, and does not constitute investment advice or a solicitation to take any financial action. It should not be relied upon when making investment or financing decisions.
