Business | Property
Channel Sponsor
800 new residents setting up home in Dubai every day
House rents in Dubai, the single largest worry among the majority of the emirate's 1.3 million residents, will continue to appreciate in the coming years due to the influx of a whopping 292,000 new entrants - employees and residents every year, officials said yesterday.
- By Saifur Rahman, Business News Editor
- Published: 00:12 July 20, 2007
- The population of Dubai, currently at 1.3 million, is to grow at 22.46 per cent, doubling in about four years.
- Image Credit: Asghar Khan/Gulf News
Dubai: House rents in Dubai, the single largest worry among the majority of the emirate's 1.3 million residents, will continue to appreciate in the coming years due to the influx of a whopping 292,000 new entrants - employees and residents every year, officials said yesterday.
Although the market showed signs of softening in recent past, the issuance of more than 800 work and residence visas per day will continue to push the demand upwards, they say.
At this rate, the population of Dubai is to grow at 22.46 per cent, doubling in about four years. The 44,000 new housing supplies in the UAE this year would be inadequate compared to the requirements.
While this might be a good news for investors, developers and landlords, it may not go down well with tenants who are struggling to make both ends meet, making life in Dubai dearer.
Abu Dhabi scheme
"Some apartment prices in the UAE have already settled in 2007 with a downward adjustment of close to 10 per cent. However, with increasing interest in Dubai as a business location, with inflation remaining high and interests rates remaining low for the foreseeable future coupled with an increase in mortgage business, we believe there is still a strong outlook for positive growth in the medium and long-term," Shahid Umerani of JAJ Consulting, told members of Dubai Quality Group yesterday.
The indications come as an alarm bell to Dubai's marginalised middle income group, many of whom are either sending families back home or gradually moving to neighbouring emirates.
This will also put pressures on companies' bottomlines as demand for salary hike is going to intensify in the coming months.
The rent cap has failed to make a dent in the alarming situation. Sensing this, Abu Dhabi yesterday announced a new housing scheme for bachelors with a capacity of up to 110,000 people, reflecting a shift in future demographics.
However, there could be ray of light at the end of the tunnel. "Rents would likely have to come down in the near term as they were getting out of reach of the majority of Dubai residents," the panel concluded.
But the core property market still had room for healthy growth over the next few years, with no need for a major correction, they said.
Key figures
292,000 new residents are entering Dubai every year22.46% is the rate of population growth in Dubai if this influx is taken into account
44,000 new housing units in the UAE this year would be inadequate to meet the demand.
Have your say
Does it worry you that house rents in Dubai continue to rise? What have you done about it? How much are you prepared to pay for housing? Are you considering alternative solutions? What are they?Tell us.
Your comments
It worries me and it probably also worries every person living in Dubai. It is almost impossible to plan anything because things are very changeable here. I am not even sure by how much rents will increase next year. Buying property is a viable solution.
Ranjeet
Dubai,UAE
Posted: July 20, 2007, 09:34
I am prepared to pay only Dh15,000 per annum as rent. I am considering moving to Ras Al Khaimah along with 10 other staff. We will share a car pool. This way we can save a lot instead of wasting our hard earned money on exorbitant rents.
Manoharan
Dubai,UAE
Posted: July 20, 2007, 09:22
Share this article
Gulf News classifieds
Popular in Business
Business Editor's choice
-
Credit swaps... a fair trade
Would you swap an unbuilt unit at the Lagoons for an apartment at JBR?
-
New face of safety
Volvo reveals a sleeker S60, ready to hit the roads early next year
-
When the Web lives worldwide
Cutting-edge firms are building massive data facilities all over the globe
-
Banking
Mortgages: there's light at the end of the tunnel
UAE buyers are securing home loans again
