Dubai: Sharjah residents are not making the shift to new homes in Dubai, at least not in sizeable numbers to make a difference to rental dynamics, according to the latest report from the property services firm Asteco.
That rents in Dubai did not decline enough — in fact they are already showing signs of high stability — is cited as the primary reason for far fewer relocations Sharjah during this market cycle. In fact, the softening in Sharjah rents has also ground to a near halt — during the third quarter it was down a marginal 1 per cent, according to the report.
“The stabilisation of the [Sharjah] market was a knock-on effect, in part, to rental rates in Dubai also balancing out,” said John Stevens, managing director of Asteco.
But Sharjah’s residents also needn’t worry too much about sharp increases to what they are paying now. New stock is being added, and that should exert pressure on landlords trying to get more. As such average rents are “still 38 per cent cheaper than in 2008” as additional supply keeps rates from increasing rapidly, the Asteco report says.
New developments are fetching rents of Dh20,000-Dh35,000 for a studio and Dh45,000-Dh90,000 for a three-bedroom unit. Rents in the popular Al Majaz area are going from Dh25,000 to Dh35,000 for a studio, and three-bedroom units from Dh48,000 to Dh90,000. Corniche values are at Dh26,000-Dh35,000 for a studio, with three-bedrooms commanding Dh60,000-Dh95,000. \
More tower projects are also getting off the starting blocks, with a recent one being the Sahara Tower 6 by Al Thuriah. Construction of the twin-tower has started and will feature 376 residential units, which are now on sale and due for handover in the fourth quarter of 2019.
Based on official data, real estate related investments in Sharjah were valued at Dh12.1 billion during the first six months, from a total of 1,860 sales transactions. Of this, 89.5 per cent were within Sharjah City in areas such as Al Khan (240 transactions), Al Majaz 3 (173), Sajaa Industrial Area (159), Al Nahda (111) and Muwaileh Commercial District (105).
Of the other Northern Emirates, Ras Al Khaimah recorded a 1 per cent rise in apartment units during the third quarter, as did Ajman — taking prices close to their 2008 peak levels (only 9 per cent lower).
Rents for newer buildings in Ras Al Khaimah are now at Dh26,000-Dh40,000 for a studio and between Dh85,000-Dh110,000 for a three-bedroom unit.
The gains recorded in Ajman were attributed to the “better quality supply to its stock while also improving its overall offering to residents in terms of retail and road connectivity”.
High-end apartments now range from Dh22,000 to Dh38,000 for a studio and three-bedrooms at Dh42,000-Dh72,000.
Fujairah’s residential rentals were more or less stable through the third quarter as new supply came online such as the housing project in Al Taween.
Rents vary from Dh23,000-Dh28,000 for a studio and Dh45,000-Dh60,000 for a three-bed.
For information on the real estate sector, within the UAE, please visit our sister site, GNProperty.com.