Key takeaways
- The RERA Rental Index Dubai (renamed Smart Rental Index since January 2025) is the Dubai Land Department's official tool. It sets the legal rent increase at lease renewal, zone by zone.
- The scale comes from Decree No. 43 of 2013: 0% if the current rent is under 10% below the market average, then 5% (11-20% gap), 10% (21-30%), 15% (31-40%), and 20% maximum beyond that.
- Since 2025, the index also grades each building from A to D based on age, maintenance, and management quality. This can widen the allowed rent gap between two neighboring towers in the same sub-zone.
- The calculator is free on dubailand.gov.ae and the Dubai REST app. It asks for the zone, property type, number of bedrooms, and current rent to produce the legal range.
- A minimum 90-day written notice before lease expiry is mandatory for any increase. Without it, the rent renews unchanged for the next period.
How do you use the RERA calculator step by step?
The tool is free and takes just a few clicks. There are two entry points: the dubailand.gov.ae portal, under Services > Rental Index, or the Dubai REST mobile app, under Services > Rental Increase Calculator. Both return the same result, drawn from the same DLD database.
Six fields need to be filled in, in this order:
- Contract type: select "renewal" (not "new contract").
- Use: residential or commercial.
- Property type: apartment or villa.
- Zone: the administrative sub-zone, not the marketing name.
- Number of bedrooms: studio, 1BR, 2BR, etc.
- Current annual rent in AED, net amount excluding charges.
The tool returns three figures: the index average for that zone-and-type combination, the percentage gap between your rent and that average, and the legally applicable increase percentage under Decree 43's tiers.
Decree No. 43 of 2013 caps the renewal increase at 0%, 5%, 10%, 15%, or 20%, depending on the gap between the current rent and the RERA index average.
The most common mistake is entering "Dubai Marina" when the title deed actually reads "Marsa Dubai," the real administrative sub-zone. The calculator only recognizes official DLD labels. A mistyped zone skews the reference average, and with it, the whole result.
The figure produced is indicative, but it carries weight. The Rental Dispute Centre refers to it systematically in landlord-tenant disputes.
What the A-D classification changes since 2025
Since January 2025, the DLD has overlaid a second filter: the Smart Rental Index, which grades every building from A to D based on age, amenities, maintenance, and management quality.
The Smart Rental Index grades residential buildings from A to D based on age, amenities, maintenance, and management quality.
In practice, two neighboring towers in the same sub-zone can show different averages if their grade differs. A building graded A (newer, well managed) tolerates a higher reference rent than a grade D building on the same street. Check your building's grade before disputing a figure that seems low: it often explains the gap. This is the same kind of micro-zone arbitrage we frame for our landlord clients, notably on recent developments like The Residences by DIFC, already positioned as grade A at handover.
The increase scale: the 5 tiers of Decree 43
The calculation follows a fixed scale. It compares the current contractual rent to the RERA index average for the same property type and sub-zone.
Decree No. 43 caps the renewal increase at 0%, 5%, 10%, 15%, or 20%, depending on whether the gap to the index average rent is under 10%, 11-20%, 21-30%, 31-40%, or over 40%.
In practice, five tiers apply:
| Gap to index average rent | Maximum allowed increase |
|---|---|
| Less than 10% below | 0% |
| 11% to 20% below | 5% |
| 21% to 30% below | 10% |
| 31% to 40% below | 15% |
| More than 40% below | 20% (absolute cap) |
Example: a 1-bedroom rented at AED 95,000, while the index average for that sub-market is AED 130,000. The gap is 27%. This falls in the 21-30% tier, so the increase is capped at 10% — AED 9,500 maximum.
AED 9,500 (10% on AED 95,000)Capped increase (example) · Decree No. 43 of 2013, DLDThe calculation applies only to the base contractual rent. Service charges and Ejari fees fall outside its scope. The cap resets at each annual renewal: a landlord can't stack unapplied prior-year increases to catch up in one go. It's a calculation replayed every year, not a cumulative trajectory.
To place this mechanism within a broader portfolio strategy, see our yield comparison by neighborhood.
How much do towers in the same neighborhood really differ?
Two towers 300 meters apart can show RERA averages 15 to 20% apart. The neighborhood name says nothing about the real sub-market. Here are the most significant gaps, tower by tower.
Dubai Marina clearly separates the canal-front from the rest. Marina Promenade and Emaar 6 Towers, with direct canal views, quote above the average of second-row buildings on the Sheikh Zayed Road side, less exposed and often older.
Jumeirah Village Circle varies sharply by district. The index differs between District 10 and District 15, two zones administratively within "JVC" but with very different handover years and finish standards.
Business Bay contrasts Marasi Drive, canal-front, with the landlocked buildings on the Al Abraj Street side. Same logic as the Marina: the view and canal access justify a distinct index.
Palm Jumeirah is the extreme case. Shoreline Apartments, Tiara Residences, and the Trunk towers share a common address, "Palm Jumeirah," but fall under three different RERA brackets.
Downtown distinguishes towers on Burj Khalifa Boulevard from those in South Ridge or Old Town, set further back.
The consequence is direct: always compare a seller's listing to the index of its precise sub-zone, never to the neighborhood's overall average. It's the most common mistake tenants make when contesting an increase at the Rental Dispute Centre. To frame a purchase project zone by zone, our neighborhood comparison also details these yield gaps by sub-market.
Using the index to negotiate a renewal
The index doesn't just set a ceiling. It becomes a bargaining chip, in either direction.
On the landlord side, the procedure is clearly framed. The increase notice must go out 90 days before lease expiry, in writing, with a screenshot of the RERA calculator as proof of the applied tier.
Any rent increase in Dubai requires at least 90 days' written notice before contract expiry. (Source: Law No. 26 of 2007 amended by Law No. 33 of 2008, Emirate of Dubai)
On the tenant side, the reflex is to check that the announced increase matches the legal tier, not a round figure negotiated verbally. If the gap doesn't add up, the case goes to the Rental Dispute Centre.
3.5% of annual rent, capped at AED 20,000RDC filing fee · Rental Dispute Centre, DLDOne case comes up often: a property under-rented by 35% for three years. The landlord can't close that gap in one go. It takes three successive renewals, each at the maximum 20% tier, to align with the index.
That's where a more radical decision comes into play. When the gap exceeds 30%, three years of gradual rental catch-up often yield less than an immediate sale at market price, especially in a zone where rental demand stays tight, as detailed in our Dubai neighborhood comparison. This is precisely the kind of arbitrage we frame for our clients, including through a fast cash exit when rental catch-up no longer makes sense: see Sell in 48 Hours.
What the index tells you about real net yield
The RERA index gives you a gross rent. Real yield is calculated after charges: service charges (often AED 12 to 22/sq ft/year depending on the tower), Ejari, DEWA, and property management fees. Two towers showing the same indexed rent can deliver very different net yields depending on their charge ratio.
This is where the Smart Rental Index, launched in January 2025, proves useful: a grade-A tower, better maintained, often justifies more predictable charges than a grade-D tower, even at an identical gross rent.
The dirham remains pegged to the dollar at AED 3.6725, which removes currency risk for a dollar-based investor. (Source: Central Bank of the UAE)
Once charges are deducted, the gap with Europe stays wide. Gross yields observed in Dubai in 2026 range from 5 to 8% depending on the zone, versus 2 to 4% in Paris, Geneva, or Brussels.
The gap widens further on taxation. There's zero tax on rental income or capital gains in the UAE, against a combined levy that often exceeds 30% in France, Belgium, or Switzerland depending on the canton. On an identical net rent, the Dubai-based investor keeps the entire cash flow.
5-8%Dubai gross yield 2026 · DLD, REIDINBefore deciding between holding, re-letting at the new indexed cap, or selling, the net gap is worth calculating precisely with our yield calculator. It's the arbitrage we systematically frame with our clients ahead of lease renewal. To situate this yield by neighborhood, our JVC, Business Bay, Marina, Downtown, Palm comparison details the gaps sub-zone by sub-zone.
Go further
Three related reads in the Level8 journal:
- Best neighborhoods to invest in Dubai in 2025: yield and price per sq m — JVC (7-9% gross yield), Dubai Marina (5.5-7%), Business Bay (6-7.5%), Downtown (2.5-5%), and Palm Jumeirah (4-5.5%): a comparative analysis for francophone investors in 2025.
- Short-term rentals in Dubai: holiday home license, 2026 guide — A 2026 operational guide: getting the DTCM holiday home license, comparing short-term yields tower by tower in the Marina, Palm, and JVC, and securing operations.
- Marina, Downtown, Palm: how long to sell in 2026? — How long does it take to sell a property in Dubai in 2026? Real figures by neighborhood, property type, and payment method, with a detailed timeline.
FAQ
How do I know which RERA sub-zone my property falls under?
Check the title deed or the Ejari contract: it's the DLD's official administrative label (e.g. "Marsa Dubai," not "Dubai Marina") that you need to enter in the calculator. A mistyped marketing name skews the reference average, and with it, the result.
What notice period must my landlord respect before raising the rent?
Decree No. 43 of 2013 requires at least 90 days' written notice before the lease expires. Without it, the rent renews unchanged for the next period, regardless of the legal margin available.
What's the maximum rent increase allowed in Dubai in 2026?
The absolute cap remains 20%, reached only if the current rent is more than 40% below the RERA index average for the relevant sub-zone and property type. Below a 10% gap, the allowed increase is zero.
Why can two neighboring towers show different reference rents?
Since January 2025, the Smart Rental Index grades every building from A to D based on age, maintenance, and management quality. A grade-A building tolerates a higher reference rent than a grade-D building in the same sub-zone.
Can the increase calculation stack multiple years of unapplied catch-up?
No. Decree 43's cap resets at each annual renewal based on that year's observed gap. A landlord can't catch up on increases not applied in prior years.
In a dispute, which body rules based on the RERA index?
The DLD's Rental Dispute Centre systematically refers to the figure produced by the official calculator to arbitrate between landlord and tenant. That same indicator serves as the reference for framing a renegotiation before any dispute arises.
Sources
The figures and rules quoted in this article come from the following sources :
