Dubai: The new rental index to be released shortly shows an average price drop in rents of 10 to 15 per cent, according to officials at Dubai's Real Estate Regulatory Authority (Rera).
Mohammad Khalifa Bin Hammad, director of real estate relationship regulation at Rera, says the new rental index is still being updated.
"The update will be released [later] in April. What has been noted from the first rental index is an average price change of between 10 and 15 per cent," Bin Hammad said in a statement to the press.
However, Marwan Bin Galita, chief executive of Rera, said these figures refer only to certain communities.
"So far we are seeing a 10 to 15 per cent correction in rent for one or two communities.
"But the full average will be shown in April," Bin Galita told Gulf News.
The new index cannot be released until all new tenancy contracts have been registered and collected through Rera's online rental contract registration programme, Ejari.
Some industry experts aren't sure the announced price drop is accurate.
"No, 10 to 15 per cent sounds a little bit conservative.
"It's got to be (more like) 30 per cent. But I don't disagree that in certain areas that is the case," Vincent Easton, an independent property analyst, told Gulf News.
Areas like International City, Discovery Gardens and Jumeirah Lake Towers have seen rents fall the sharpest.
It is now possible to rent a studio in International City for around Dh35,000 and a one-bed apartment in Discovery Gardens can be snapped up for around Dh60,000.
EFG-Hermes in a real estate report this week said they believe rental rates in Dubai "can decline in the 20 to 50 per cent range" from their peaks in 2008.
There is much excitement surrounding the new index, with many Dubai tenants confident that it will reflect the recent tumble of rental rates across the emirate.
"There are small signs in the market - it's been like a little heartbeat going up and down and hasn't flatlined yet - that people are starting to feel that rents are at an affordable level now," said Easton.
With rents falling, many people are looking to move into bigger apartments or even villas, a choice that was once beyond their reach.
Our flat is old in Hor Al Anz east and there is no good maintenance. Still if you renew your contract the increase is terrible, really high! The manager asking for money for some sort of arrangement.
Posted: April 02, 2009, 18:06
RERA is doing a good job of providing rent guidelines, however they should keep their words and provide data as promised. It is agreed that the new index may still have some higher rental figures, then RERA should make it a point to revise the Index every 3 months and once rent market stabilises it can be 2 times in a year
Posted: April 02, 2009, 14:16
what if the agreement is already dine for a year in last december 2008 to 2009 december wont the rent decrease for us? i wan to cancel my agreement if it is the same rent? is it possible?
Posted: April 02, 2009, 13:25
Absolutely there is no decrease in rent in Bur Dubai area. My tenancy contract was renewed on 28 March 2009 with an increase of about 10 per cent per year over the previous year. The scenario in the market is actually different from what we read in newspaper or rumors spreading around. There are several untaken flats in the same building where I live, which are never let out on lower rents but rather kept without occupancy.
Posted: April 02, 2009, 11:31
This rent index has to be realistic. Realty peoplea are in denial and do not want to lower the rent and price them according to the area.
From A Reader
Posted: April 02, 2009, 11:21
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