Dubai rents up 10%; to rise more

Tenants in Dubai are prepping themselves to shell out more in rent this year as landlords, after a few years of falling rental income, are set to take advantage of the emirate’s much improved real estate market.

Annual rents hikes are now a given and the first quarter of this year saw a considerable increase in asking rents. “The rental market maintained its positive trend in Q1 2013,” states real estate specialist Jones Lang LaSalle (JLL) in its latest report.

“Reidin Rental Indices recording an improvement of 10 per cent year-over-year. Both the villa and apartment rent indices went up by 10 per cent year-over-year. While the villa rental index has achieved its peak value in February 2013, the apartment rental index remains 26 per cent lower than in January 2009 (when the index commenced),” said the report by JLL.

Rentals have spiked the most in well-established areas whereas secondary locations remain stable.

As per JLL findings, areas such as Burj Downtown, Dubai Marina and Palm Jumeirah have seen the highest jump in rents while well-established residential communities in central Dubai are expected to see further price and rental growth over the rest of 2013.

On the other hand, less completed projects in more remote areas will need more time before witnessing an increased demand and performance.

An Indian living in Dubai’s Springs area confirmed that his landlord has already sought an increase in his rent as his contract comes up for renewal in a month.

“I live in a three-bedroom unit in The Springs (a type 3M). I signed the lease last year and paid Dh130,000 in one cheque. My landlord’s agent now tells me that such a villa is now being leased for nothing less than Dh140,000 to Dh150,000 per annum,” he told Emirates 24|7.

Based on online classifieds, popular villa community Arabian Ranches has seen a rent spike of 25 per cent year-on-year. The rent now for a two-bedroom villa in the community is Dh125,000 whereas  a similar villa in The Springs can now be rented for Dh95,000 per annum, which is again a similar 25 per cent year-on-year increase.

MUST READ:

Union Prop extends Dh400m debt

Follow Emirates 24|7 on Google News.