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19 March 2024

Dubai rent watch: International City, Greens rising fastest

Published
By Parag Deulgaonkar

Dubai’s International City, billed as an affordable community, has registered the maximum increase in property prices and rents in the emirate, according to a new report. 

Rents

The Reidin Rent Index climbed by 15 per cent y-o-y and six per cent q-o-q.

The villa rent index went up by 14 per cent y-o-y and appeared to have reached its peak value, while the apartment rental index scored a 15 per cent y-o-y growth, but remains 19 per cent lower than its record level.

International City was again the top performer in terms of rental values growth, followed by Jumeirah Lake Towers, The Greens and Dubai Sports City; while Jumeirah Beach Residence recorded slowest growth.

This supported the conclusion that secondary locations have been improving as tenants continue to relocate from the expensive areas to more affordable neighbourhoods, the report said.

Sales

Quoting the Reidin Residential Sale Index, Jones Lang LaSalle said that International City recorded the strongest price growth with a 27 per cent year-on-year (y-o-y) increase, highlighting a strong recovery in secondary locations.

“The broad-based recovery in the residential sector is resulting in price and rent increases across most areas. “Unlike last year, the fastest growth is now being experienced in mid-market and affordable projects and there are signs that the rate of increase is slowing in some high-end locations,” Alan Robertson, CEO of Jones Lang LaSalle MENA, said.

In Q3-2013, the Reidin residential sale index grew by almost 18 per cent y-o-y and six per cent quarter-on-quarter, but remains 15 per cent lower than its peak value.

Villa prices rose 14 per cent y-o-y, while the apartment sale price index increased by 15 per cent y-o-y.

Data shared exclusively by Reidin.com with Emirates 24|7 in July revealed that 1,272 apartments were sold during the first six months of 2013, against 870 units same period last year, an increase of 46 per cent.

Average prices rose by 27 per cent to Dh499 per square feet (psf) compared to Dh392 psf.

Currently, listed prices of studios range between Dh270,000 and Dh370,000, while one-beds are being sold for Dh380,000 to Dh500,000.
Asteco Property Management, in its second quarter report released in the same month, said that rents in International City had increased at a faster rate than Dubai Marina.

Annual rental for a two-bedroom unit rose 11 per cent to Dh42,500 in the second quarter, a 27 per cent annual increase, while Dubai Marina grew 8 per cent, 20 per cent year-on-year (yoy) with two-bedroom apartment now leasing on average for Dh110,000 per year.

Prices in Discovery Gardens jumped 17 per cent to Dh7,550 per square metre in the second quarter, 75 per cent yoy.

The Greens saw a 15 per cent growth with average prices at Dh12,400 per square metre, an annual increase to 44 per cent.

Although JLL has raised concerns of unsustainable growth in prices, it stated that the residential market has carried on with its broad-based recovery, on the back of growing positive sentiment, the status of Dubai as a “safe haven”, a rising population and solid economic fundamentals.