How Dubai's Smart Rental Index helps residents negotiate unfair rent hikes

Tenants in Dubai are increasingly benefitting from the Smart Rental Index introduced as tenants are successfully challenging unfair and unjustified rent increases by the landlords.

Therefore, rents in older buildings have started to correct downward six months after the introduction of Index as tenants successfully reverse landlord’s decision to hike rents without a valid reason.

“Tenants are using the index it to stop unfair hikes — and successfully,” said Grace Jackson, leasing manager – Dubai, Huspy.

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“A landlord proposed a 25 per cent increase for a tenant. Using the Smart Index, we found the legal increase was only 10 per cent based on similar buildings and the law. After showing this, the landlord agreed to reduce the hike. Another tenant in Dubai Marina challenged a 15 per cent rent jump. The Smart Index showed the market rent hadn’t moved much for that building type. The landlord agreed to renew at the current rate,” said Grace.

In January, the Dubai Land Department launched the Smart Rental Index 2025, which relies on an advanced building classification system that considers all technical and service-related aspects of properties. Each building is evaluated based on a comprehensive set of criteria, including technical and structural characteristics, the quality of finishes and maintenance, the building’s strategic location and its spatial value, as well as the level of services and facilities available, such as maintenance, cleanliness, and parking management.

Grace Jackson. Photo: Supplied

“The new index uses real-time data and building ratings to give more accurate rent estimates. In areas like Jumeirah Village Circle, for example, rents in older buildings have started to correct downward, while newer, well-maintained towers are maintaining or even increasing rent due to their higher building classification,” she added.

Some landlords follow rules

According to real estate consultancy Cavendish Maxwell, rental contract data from Q1 2025 showed a notable increase in the share of renewal agreements, likely driven by the introduction of the New Smart Rental Index, which aims to protect tenants from steep rent increases by regulating permissible rent adjustments based on comprehensive market data. Renewals accounted for 70.1 per cent of contracts in Q1 2025, up from 61.1 per cent in Q4 2024 and 62.2 per cent in Q1 2024.

Grace Jackson added that most institutional landlords are following the rules set under the Smart Rental Index, but some private owners still try to push higher increases.

“However, tenants are now more informed. In Business Bay, one client was able to negotiate a better deal simply by showing the official index results. The landlord had no grounds to argue,” she added.

Echoing other industry peers, she added that the Smart Rental Index has slowed down rent increases slightly.

“The index has made it harder for landlords to overprice units. It’s brought more balance, especially in mid-range and older buildings.”

A new era of accountability

Grace pointed out that the introduction of the Smart Rental Index marks a new era of accountability. “Agents now spend less time in subjective negotiations and more time educating both parties on what the data shows. In short, the Smart Index isn’t just a tech update, it’s a culture shift. And it’s long overdue.”

Overall, she added that this tool is making the Dubai rental market more balanced and data-driven, which benefits everyone by helping both sides make smarter decisions.

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