Sharjah: After months of stagnation, Sharjah’s rentals may finally be easing.
Rents in several key residential areas in Sharjah dropped this month - the first time in 2016, say the emirate’s property brokers and agents. Many moving in to buildings in neighbourhoods like Al Khan, Al Nahda and Al Tawuun in recent weeks say their new rental amounts for the whole year were almost Dh3,000 to Dh5,000 less.
A random XPRESS survey showed that two-bedroom apartments in Al Majaz, Al Nahda and Al Tawuun that went for Dh55,000 to Dh65,000, are now available for Dh50,000 to Dh58,000 while one-bedroom apartments that commanded Dh42,000 and up are now going for about Dh40,000. The drop in rentals in other parts of Sharjah are similar, say realtors.
Changing dynamics
The manager of an Al Nahda building that has 800 two-bedroom hall kitchen (BHK) apartments said his owners decided to bring the rents down from Dh58,000 to Dh53,000 barely 10 days ago. “This had to be done because of the current market scenario, but it’s only the first time that our rents actually fell after they remained steady for almost a year and a half,” he said.
The drop in rents is similar in almost every building in the vicinity. Tiger Group that owns the new Al Qadesya twin tower on the edge of Sharjah’s border with Dubai in Al Nahda has for weeks been advertising their revised rent on the buildings’ exterior – Dh38,000 for 1 BHK. A one bedroom unit in the same highrise as recently as May was being leased for Dh42,000.
International real estate consultancy Cluttons reckons rents in Sharjah’s residential property market are set to continue to decline throughout 2016, following an average fall of 5.7 per cent during the first quarter which, they say, dragged the overall year-on-year fall in rents to 8.3 per cent “The weaker conditions in the market are expected to persist as the year wears on, with rental falls of between three and five per cent likely, on average,” said Faisal Durrani, head of research at Cluttons. “However well managed buildings are likely to see rents remaining stable, ” he added.
Residents of the emirate said they are relishing the prospect of renewing tenancy at vastly reduced rents.
“When it came to renewing my tenancy after the three year lock-in period earlier this January, my rents had shot up by Dh18,000 annually or over 40 per cent. However with the way things are going I am hopeful that rents will be a lot more affordable by the time my next renewal comes up in January 2017,” said Pakistani Rashid Alam, who has been living in a two-bedroom apartment in Al Tawuun since 2012. For the first three years Alam paid Dh42,000 annually, but early this year his rent shot up to Dh60,000. He said he is hoping the current rent of Dh55,000 falls even further in another six months.
“It’s a massive relief for those with families. We were struggling to cope with high rents all this while, but suddenly the situation is looking brighter,” said Indian executive P.K. Raj, a resident of Al Khan who claimed rents in his building fell by “a couple of thousand dirhams”.
