Dubai: Dubai tenants are in the mood to upgrade – and this shows in residential rentals in prime locations. As tenants move into new homes – more spacious – rents in some low-cost locations such as Discovery Gardens are coming under more pressure.
In fact, Discovery Gardens reported a 22 percent drop in rents in the 12 months ending March. The listings show one-bedroom apartments at only Dh30,000, with some landlords allowing one or two months of rent-free accommodation.
Even slightly more upscale surroundings – such as JLT and Dubai Marina – recorded a 16 percent decline over the period, according to property consultancy Core. This has created opportunities for tenants to take a one-bedroom apartment in the slightly upscale Burj Dubai Marina for a mark of 55,000 dirhams – 60,000 dirhams, while the JLT unit would be under 50,000 dirhams.
“The COVID-19 shift of tenant from apartments to villas has collectively increased downward pressure on apartment rents,” says Core Dubai’s latest real estate market update.
Another 10,500 homes were handed over in Dubai in the first quarter of 2021, including UNA apartments
In Town Square, Amna Tower in Madinat Al Habtoor, The Address Jumeirah Gate in JBR, Bloom Towers in JVC
And multiple connections at Dubai Creek Harbor.
The largest number of deliveries during the first quarter of 2021 was in Dubailand (Town Square, Arjan and Akoya Oxygen).
It is followed by Business Bay, Jumeirah Village Circle, Dubai Creek Harbor and Dubai Marina.
It is different with villas
If the tenant is looking for a villa, the current situation is that he must make his decision quickly. Especially for those aiming for a super premium address in The Palm or Emirates Hills – both locations have seen rental increases of 10 per cent plus over the past 12 months. The Palm has recorded home sales of Dh100 million – but the island’s rental offerings, too, are not particularly difficult to come by.
These trends confirm what has been evident over the past two quarters. Any site or owner that offers ample spaces with some green space (or sand, in the case of the palm) is what is needed as modernization processes accelerate.
Move or stay?
Industry sources agree that selective increases are emerging in the rental market in Dubai, with The Palm Island as a prime example. Two or three years ended in which every location in the city recorded a decrease in rents.
Renewal or relocation depends somewhat on what the owners are willing to offer. “Most of them are still willing to negotiate lower rents and flexible lease terms on renewal to retain tenants,” the report adds. This has resulted in a large portion of the tenants remaining in their current place of work as they have been able to achieve rental savings on negotiations while avoiding inconvenience and additional transportation costs.
“However, depending on the flexibility of the owner, tenant working arrangements and the financial situation, many of them have moved in either to achieve more space or to achieve significant savings. We expect apartment rents to continue to decline during the remainder of 2021.”
But the 12-month check payment options decrease, with three or six checks being the norm. Many landlords still use rental periods, especially those who have new buildings and apartments to fill in. Free chiller is another big plus for renters who have decided to take up new premises.
So, have you decided to move or to stay?
More to track …
Bulletin Observer Business News
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