Dubai: Still spending half of your salary on rent? Dubai tenants looking to cut down on housing expenses would be well advised to consult the latest rental rate data.
While some landlords may be looking to pocket higher yields, new research suggests that several communities in Dubai could offer some relief this year, especially if they are newly developed and the supporting infrastructure and basic amenities are still quite limited.
Apartment rents have declined by 5 per cent since the last quarter and 6 per cent over the year, according to a report. Rental declines were noted in various apartment types, from affordable, mid to high-end units, with certain areas offering tenants as much as Dh18,000 in savings per year.
Both high-luxury and affordable accommodation registered a rental decline of 6 per cent in 2016 compared to a year earlier, while mid-high end units posted a 7 per cent drop.
The locations that registered the biggest drop in rental rates for one-bedroom apartments in 2016 are Jumeirah Lakes Towers (JLT), Jumeirah Village and Dubai Sports City, where flats posted annual price reductions of Dh9,000 to Dh15,000 per year, based on the data from Asteco.
A clear winner in terms of providing the biggest rental cuts for one-bed flats, JLT has properties that can be leased for Dh75,000 per year, down from the Dh90,000 average rate recorded a year earlier.
In Jumeirah Village, tenants can secure one-bedroom units for Dh60,000 annually, about Dh13,000 cheaper than the average rate in 2015.
Residents opting to live in Dubai Sports City can find apartments that cost Dh65,000 a year, down from Dh74,000 in 2015.
In terms of annual rental rates, however, International City remains the most affordable location, where rents for one-bedroom units have dropped from Dh50,000 to Dh45,000.
Jumeirah Village and Deira came second on the most budget-friendly list, with rents dropping to Dh60,000 on average.
For two-bedroom flats, the biggest rate cuts were reported in Dubai Marina, with rents falling by Dh18,000 annually, from Dh143,000 to Dh125,000, on average.
Dubai Sports City also offers bigger families opportunities to cut their expenses, as rents in the area slipped from Dh105,000 in 2015 to Dh90,000 in 2016, offering savings of Dh15,000 per year.
Although it may be considered one of the most expensive luxury communities in Dubai that caters to wealthy residents, the Palm Jumeirah is also offering huge price reductions, with annual lease rates dropping from Dh198,000 to Dh175,000, registering an 11.6 per cent decline.
A closer look at the rental rates, however, would reveal that International City is still the best choice for tenants looking to spend less on rents. Annual lease rates for two-bedroom flats in the area are the lowest in the emirate at Dh63,000 per year, which dropped by 3 per cent from Dh65,000 in 2015.
Communities with biggest decline in rent:
One-bedroom apartment (2015 vs 2016 rates)
Jumeirah Lakes Towers: From Dh90,000 to Dh75,000
Jumeirah Village: From Dh73,000 to Dh60,000
Dubai Sports City: From Dh74,000 to Dh65,000
Bur Dubai: From Dh73,000 to Dh65,000
Discovery Gardens: From Dh72,000 to Dh65,000
Two-bedroom apartment (2015 vs 2016 rates):
Dubai Marina: From Dh143,000 to Dh125,000
Dubai Sports City: From Dh105,000 to Dh90,000
Palm Jumeirah: From Dh198,000 to Dh175,000
Greens: From Dh143,000 to Dh130,000
Downtown Dubai: From Dh175,000 to Dh160,000
1 bedroom (2016 rates):
International City: 45,000
Jumeirah Village and Deira: Dh60,000
Dubai Sports City and Bur Dubai: Dh65,000
Al Barsha and JLT: Dh75,000
Business Bay: Dh85,000
2 bedroom (2016 rates)
International City: Dh63,000
Deira and Discovery Gardens: Dh85,000
Jumeirah Village and Al Barsha: Dh95,000
Bur Dubai: Dh100,000
Jumeirah Lakes Towers: Dh115,000
For information on the real estate sector within the UAE, please visit our sister site, getthat.com.