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29 March 2024

Rent consuming 50% of your salary in Dubai?

Rents in Dubai Marina and Jumeirah Beach Residence are set to increase as the Dubai Tram now becoming operational. (Ashok Verma)

Published
By Parag Deulgaonkar

Professionals, preferring to live in posh localities such as Dubai Marina, the tallest building block in the world, are sharing apartments or moving out of the master community as rising rents are gobbling up almost 50 per cent of their salaries, according to a real estate consultancy.

“The prices for rents saw a rise over the past year but salaries of residents have remained the same. With the average salary of Dh20,000 per month for a resident of Dubai Marina and an average rent of Dh110,000 per annum for a one-bedroom apartment, residents simply cannot afford to spend nearly 50 per cent of there income just on rent alone,” Laura Adams, Co-Founder and Managing Director, Carlton Real Estate, said in an advisory note.

“This has resulted in many professionals choosing to share apartments and rent or go into short-term accommodation or move out to communities in Dubailand or Dubai Investment Park until the market corrects again.”

Landlords need to understand that the amount of void periods that they are having between tenants due to high rent demands or one-cheque requests will result in a lesser income in the year to come, she adds.

Reidin.com, in its September update, said rents in Dubai’s residential market have increased by 19.8 per cent year-on-year (y-o-y). Apartment rents are up 22.5 per cent y-o-y, while villas rose 7.9 per cent y-o-y.

In fact, 53 per cent of respondents in a poll conducted by Emirates 24|7 said the rents were rising in Dubai. Another survey by movesouq.com found that nearly 75 per cent of Dubai residents were planning to move to new homes on lease renewal due to rent hikes.

“Our landlord has told us that he plans to increase our rent by Dh10,000. We have agreed to pay since our rent is still cheaper than the market rate in Dubai Marina,” says Andrea S, a resident of Dubai Marina.

“I have seen a lot of people moving out of the building as they could not afford the rent increases. Those apartments are, however, are not remaining vacant for long,” she adds.

Rents in Dubai Marina and Jumeirah Beach Residence are set to increase as the Dubai Tram now becoming operational, says Cluttons, which states, “Investors and renters are already looking to buy and lease units in close proximity to tram stations.”