Dubai rents Q1, 2018: All you need to know
We take a look at the property market in Dubai during the first quarter of the year
What was the general market movement?
It was a generally stable start to the year for the Dubai renting market, although brokers are seeing fragmentation, which, according to Asteco, is widening the rental ranges "considerably".
Average residential rents fell 1 per cent quarter on quarter, but rates are down by double digits in many areas year-on-year, as they have been in Abu Dhabi.
Lower-end buildings in areas with significant supply potential have struggled to find tenants, particularly where rates and incentives were not aligned with the market.
In an effort to encourage tenants, landlords have been using incentives such as multiple cheques, rent-free periods, or absorbing agency fees and utility bills.
The fall in rents during the past couple of years has come amid lower oil prices and slower economic growth, which has seen companies trim benefits and allowances on offer to employees.
“Housing allowances for many expats are being realigned in line with changing business activity and hence their appetite for higher ticket properties remains low," Manika Dhama, senior consultant at Cavendish Maxwell, said earlier this month.
Which new developments opened?
A total of 3,650 properties were handed over in the first quarter, Asteco said. Of these, 625 were villas. This came on the back of 17,500 new units last year.
Most of the new developments are located in the investment areas along Sheikh Mohammed bin Zayed Road (E311), Emirates Road (E611). Meanwhile, the first of three towers at The Residences at Marina Gate in Dubai Marina opened.
What is the expected supply for the remainder of the year?
Approximately 30,000 units are meant to be delivered in 2018, but only 12 per cent came to the market in the first three months of the year. Apartments are set to provide the bulk of the new builds, providing 21,000 units, with another 5,000 villas to come.
Where can I expect to get a good deal?
Some of Dubai’s most popular communities have witnessed the sharpest decline in rents. These include Jumeirah Beach Residence and Jumeirah Village, which both recorded a 15 per cent drop year-on-year, while Downtown Dubai, Dubai Marina and Deira all fell 14 per cent. Other areas that have become more affordable are Palm Jumeirah, Business Bay, Greens and Dubai Sports City. For those who feel they are paying too much rent to live in Dubai, the rates are far cheaper than they were a decade ago.
Updated: April 25, 2018 01:28 PM