Dubai: Anyone on a house hunt in the UAE will tell you there’s no better time than now to make the shift.
“I was surprised I got a one-bedroom apartment in Business Bay with two parking spaces for just Dh60,000 a year,” said Samia, a newly married 27-year-old who moved in last week. “It was difficult to choose between this and another fully furnished plush apartment in DIFC where I would have had to pay Dh5,000 more.”
Farooq, another tenant in Al Taawun area in Sharjah, who was earlier paying Dh40,000 for a two bedroom apartment, said he got a steal deal this week when he moved into another flat for Dh35,000, with a month’s rent waived off.
Dh35,000Annual rent for a 2BR unit in Sharjah's Al Taawun area reported by a tenant
“My existing landlord offered to bring down the lease amount to Dh36,000, but another landlord was willing to give me a similar flat in the same building for just Dh35,000. This, with a month’s rental waiver and one parking.”
With the inventory of vacant flats growing by the day, landlords and brokers are luring tenants with hard-to-resist offers that include everything from multiple cheque payment options, sizeable price reductions, rental waivers of a month or two, additional parking spaces and even move-in-now-pay-later schemes.
But the question is will the trend continue in 2019 too?
Going by what realtors are saying, tenants can cash in on good bargains in the first quarter, after which prices are expected to stabilise
Dilip Daswani, managing director, Capitol Real Estate, said, “In 2018, we saw a huge drop — up to 30 per cent in some pockets — in both rentals and sale prices. We’re now sitting at the bottom of the curve, but going forward, the market will be able to absorb vacant units. The economy is also set to get a boost and as we approach EXPO 2020, the influx of newcomers in the market will ensure stability by the second quarter.”
Akash Kanjwani, director of Skyview Real Estate, said, “Rentals will continue to be under pressure in the immediate future as there is a huge inventory in the market. In one building we dealt with at Jumeirah Village Circle, 110 apartments had been rented out in 2016. But 40 have fallen vacant since then, as a result of which rents have drastically dropped. A studio that was going for Dh50,000-Dh55,000 is now being offered anywhere between Dh38,000-Dh42,000.”
With 100,000 units currently said to be under construction and due for completion before 2020, realtors said there will be a whole pipeline of new units in Dubai. This means traditional rental hotspots, especially in old Dubai areas like Bur Dubai and Deira, will further come down. According to them, International City remains the cheapest community to live in Dubai as opposed to Palm Jumeirah, which is the most expensive. The trend is likely to continue in 2019, with other areas like Jumeirah Village Triangle, Jumeirah Village Circle, Mudon and Reem doing well because of their affordable prices.
Haider Ali Khan, CEO of Bayut.com, said: “Property prices are falling across popular areas. 2018 definitely has been a big one for the Dubai property market due to announcements of the new retirement visa along with the 10-year residency visa and 100 per cent foreign company ownership. The new reforms are expected to boost the sales of properties in 2019 and herald the possibility of prices stabilising across the emirate.”
How to secure a great deal on your next lease
Some offers can be too good to be true, especially in a buyer’s market. Here are some tips you could use to avoid falling in the proverbial trap:
Follow the Rent Index: The Real Estate Regulatory Authority Rent Index will give you an idea of the average rents in different communities. It will also tell you by how much landlords can increase the rent in these areas
Check out credible ads: Browse through newspaper classified sections and known online property portals to find out what the asking rate in a certain area is.
Talk to brokers: Get a feel of the market from them by finding out what the general trend is, what specific buildings offer and possible issues that tenants have. Also double-check listed figures.
Do your homework on the landlord: One you’ve zeroed in on a flat, find out the credentials of the homeowner, service fee payment record etc from existing tenants or other sources in the building.
Strike a good bargain: Leverage on your own position and track record to convince the landlord to lower the rent.
Evaluate the larger picture: It’s not just the rent that matters when you move in. Living in a certain area impacts other expenses too. Find out what facilities are available in the community like Metro connectivity, groceries, laundry etc and be mindful that some areas are more expensive than others. Assess how much you would spend on fuel for your regular commutes.