Dubai: Several communities in Dubai are known for their sky-high rents, especially those within the commercial centres and premium neighbourhoods that have plenty of amenities and perks to offer.
But with rents still falling, more relief is in sight for thousands of tenants out there.
According to JLL, year-on-year rents have now declined by 6.5 per cent and 10.2 per cent for apartments and villas, respectively. It looks like the delivery of new residential units have played a part, and some landlords are incentivising tenants, just to keep their properties occupied.
During the first three months of the year, approximately 3,000 units entered the market, with apartments comprising the bulk, more than 78 per cent of completions.
Real estate specialists at Bayut have recently reviewed the pace of rental declines in popular communities in Dubai during the first quarter of 2018, and their figures show that there are cost savings to be had when shifting to certain locations.
For one-bedroom apartments, the places where rents have fallen the most are Deira, Bur Dubai, Jumeirah Lakes Towers (JLT), Al Nahda and Dubai Marina.
From January to March 2018, annual rents for one-bedroom flats in Deira cost an average of Dh55,000, down by 12.6 per cent when compared to the previous quarter’s average rate of Dh63,000.
In Bur Dubai, a similar unit is estimated to cost around Dh65,000, cheaper by 7.1 per cent from the previous quarter’s prevailing price of Dh70,000.
Where rents have fallen most
(Average decline in rents for one-bed flats)
1.Deira: -12.7 per cent
2.Bur Dubai: -7.1 per cent
3. Jumeirah Lakes Towers: -6.3 per cent
4. Downtown Dubai: -4.7 per cent
5.Al Nahda: -3.4 per cent
6. Dubai Marina: -3.3 per cent
Flats in JLT also registered a decline of 6.25 per cent, with a similar apartment now averaging Dh75,000, compared to Dh80,000 in the previous period.
Declines also continue to hit landlords in Downtown Dubai, where rates dropped by 4.7 per cent to Dh100,000, on average. In Dubai Marina, one-bed units dropped from Dh90,000 to Dh87,000 on average.
With rents continuing to fall, tenants stand to benefit, especially since landlords are trying out new ways to attract or retain occupants. "Building owners and landlords are increasingly looking to incentivise in order to retain current tenants and have done so by setting more competitive prices and more attractive lease terms ,” said Craig Plumb, Head of Research, JLL Mena.