The Return on Investment (ROI) for short-term rentals in Dubai typically surpasses that of long-term leases, making it an attractive option for property investors. Here's a detailed comparison:

1. Higher ROI for Short-Term Rentals

   Short-term rentals in Dubai often provide a 30% higher ROI compared to long-term leases, particularly in high-demand areas like Dubai Marina, Downtown Dubai, and Palm Jumeirah.
   
   These areas benefit from strong tourist and business visitor demand, allowing landlords to charge premium rates during peak seasons. On average, short-term rentals can yield 12-15% annually, which is significantly higher than the 5-8% yield from long-term leases​

   
   

2. Seasonality and Flexibility

   Short-term rentals allow property owners to adjust pricing based on market conditions, such as during major events or tourist seasons. This flexibility can lead to higher earnings during peak periods, but it also comes with the challenge of fluctuating income due to occupancy variation. On the other hand, long-term leases offer more income stability with consistent rental payments throughout the year​

   
   

3. Occupancy Rates

   Long-term rentals typically have 85-95% occupancy, thanks to one- or two-year contracts, making them a safer option for consistent returns. In contrast, short-term rentals have lower average occupancy rates (around 50-65%) but can reach 75% in prime locations with professional management​

   
   

4. Operating Costs

   Short-term rentals involve higher operating costs, including frequent maintenance, cleaning, and restocking, which can reduce net returns if not managed efficiently. Long-term rentals, however, have lower maintenance demands since tenants usually take responsibility for upkeep​

   
   

In conclusion, while short-term rentals offer higher potential returns, they require active management and come with variable income. Long-term rentals, in contrast, provide steady, predictable income with lower operational demands. Your choice depends on whether you prioritize higher returns or stable, hassle-free income.