Dubai will introduce a new rental index using data from live transactions and AI analysis, in a move experts believe should bring greater transparency to the city's runaway property market. Dubai Land Department on Sunday said it will launch the <a href="https://www.thenationalnews.com/business/property/2024/11/17/dubai-rent-growth/" target="_blank">Smart Rental Index </a>in January. Though full details are yet to be set out, the authority said the main aim was "enhancing transparency in the real estate market". "This is accomplished by providing accurate and up-to-date data that supports decision-making for investors, landlords, and tenants through an innovative tool," it said on Sunday. The current rental index, an online portal, gives tenants and landlords a ballpark figure of what the property they live in or own is worth per year. The system's estimates are largely based on average prices for that area in the past year or two. Rents have become a tug of war between tenants and landlords due to surging demand and a population boom. “This will mark a significant shift from previous matrices, which used averages to <a href="https://www.thenationalnews.com/business/money/2024/07/04/uae-property-my-landlord-wants-to-increase-rent-by-40-or-evict-me/" target="_blank">calculate the percentage increases</a>, by using real-time data, advanced technology and real estate expertise,” said Mario Volpi, head of brokerage at Novvi Properties and a property columnist for <i>The National</i>. “This initiative should give clear information to all parties, which should foster trust and promote balance in all <a href="https://www.thenationalnews.com/business/money/2024/10/24/can-you-buy-or-rent-property-in-the-uae-without-an-estate-agent/" target="_blank">real estate transactions</a>.” The Real Estate Regulatory Authority’s rental index was last recalibrated on March 1. Many tenants claimed that change favoured landlords, who had been sitting on rents that slumped during the coronavirus pandemic. <a href="https://www.thenationalnews.com/news/uae/2024/10/27/my-dubai-rent-dh60000-barsha-heights-apartment-offers-savings-amid-property-boom/" target="_blank">Rents in Dubai increased </a>for the 15th consecutive quarter in the third quarter, and by 18 per cent annually, property consultancy Cushman and Wakefield Core said last month. Apartment rents increased by 19 per cent annually, while <a href="https://www.thenationalnews.com/business/property/2024/09/28/abu-dhabi-house-rents-record-sharpest-increase-in-a-decade/" target="_blank">villa rents </a>recorded a more moderate increase of 13 per cent, indicating a trend towards stabilisation in the villa segment as prices approach affordability thresholds, the research found. There has also been a continued <a href="https://www.thenationalnews.com/business/property/2024/08/24/dubai-tenants-choose-to-renew-leases-as-rents-rise-for-14th-consecutive-quarter/" target="_blank">increase in lease renewals</a>, which rose by 16 per cent in the third quarter. The DLD’s Smart Rental Index will improve upon the current index by integrating advanced technologies such as artificial intelligence and Big Data analytics, according to Jason Hayes, founder and chairman of Luxury Property, a Dubai-based luxury property broker. The new index is expected to provide more accurate, real-time insights into the Dubai rental market trends and pricing, he said. “This will enable landlords, tenants and investors to make informed decisions based on the most up-to-date transactional activity as opposed to just portal listing data, which presents a skewed viewpoint of the market, with there being a disparity between asking price and transaction price,” Mr Hayes said. “The Rental Index may also incorporate dynamic updates combined with predictive analysis versus the current historical data released on a periodic basis. “Clarity on its specific features and differences will become clearer as the DLD launches the index but it is certainly an exciting development and adds further transparency to the rental market here, which is a core fundamental of the overall real estate space.” The move is the city's latest attempt to digitise all services, such as the <a href="https://www.thenationalnews.com/business/economy/2023/06/21/sheikh-hamdan-launches-dubais-digital-strategy/" target="_blank">Dubai Digital Strategy</a> and the <a href="https://www.thenationalnews.com/news/uae/2024/10/01/sheikh-hamdan-sets-out-dubai-action-plan-to-transform-education-transport-and-real-estate/" target="_blank">Dubai Real Estate Sector Strategy 2033</a>. The Real Estate Strategy 2033 will seek to support Dubai's goal to raise the value of real estate transactions to Dh1 trillion ($227.2 billion) by 2033 and double the sector’s contribution to economic diversification.