After three years in the UAE, Rachel Jones has finally moved into her dream apartment.
The 35-year-old Briton was earlier living in a one-bed apartment in The Greens, Dubai, but recent reversals in rents have allowed her to upgrade to a spacious two-bed home. For the same price.
And Jones is not alone. Recent falls in rent in Dubai have triggered a "flight to luxury", where people can now get more for less (or at least the same).
Jones, a media relations manager, said: "I'd wanted to live in Golf Towers since I moved to Dubai, then all of a sudden there were lots available and I was able to get a lovely two-bed for the same price as my one-bed.
"It's great. There are so many advantages. There is more light, I have stunning views, and the finishes are excellent. I can also have friends and family to stay," she said.
"If I'd waited I could have got it for less but I'm glad I did it. I needed to seize the opportunity."
Although Jones lost a month's rent on her former place to get out of the contract, she said it was really worth it. She still pays Dh120,000 but the extra space is a bonus.
Jones is part of a growing micro-trend, where people who have spent more than Dh100,000 on a one-bed apartment are moving up the property ladder. Similarly, people in smaller villas are moving to larger properties too, according to real estate agents.
Louise Pitt, Director of Leasing at Landmark Properties, said: "People are realising they can get more for their money as rents are typically 30 to 35 per cent lower than this time last year."
But along with the reduced rents, so too comes new contract trends. The past couple of years have seen tenants keen on signing two- or three-year leases as they attempt to stave off any potential price hikes, but now the tables have turned and landlords are looking for longer leases to ensure profit.
"Tenants are also asking for escape clauses to be written into contracts after six months so they can get out if they find a better offer," said Pitt.
The trend has also extended to villas as tenants take advantage of the affordability of outdoor space over high-rise living. Two-bed properties in The Springs, for example, are now on the market for Dh110,000 – Dh70,000 less than 12 months ago.
And hotel apartments – once considered too expensive by a large number of people – are today willing to negotiate with potential tenants, offering such add-ons as free internet and Dewa as incentives.
Prices have reduced steadily since their peak of October and November last year. One of the best value-for-money areas is now Tecom, in which two-bedroom apartments are on the market for as little as Dh85,000.
Similarly, some buildings on Sheikh Zayed Road have reduced the rent on two-beds by 20 per cent. Meanwhile, stock in The Springs and smaller villas in the Arabian Ranches are running low as families and couples move up the property ladder.
But Pitt warned people still have to be realistic about what they can get for their money.
"There's a lot more to choose from now so, it is pushing prices down but it's affecting villas as much because there is still high demand on smaller properties. A lot of people are looking for the impossible; they want a three-bed for Dh110,000 and it's not going to happen," she said.
But with projects coming online on a monthly basis, it remains to be seen how rents will be affected going into the cooler months, but the experts suggest they will remain stable as competition increases.
Bernard Aoun, Manager of Residential Sales and Leasing at Better Homes, said: "It is very hard to know what will happen over the next few months in terms of real estate pricing. What we can say is that the Dubai real estate market experienced a positive May and June 2009 with an increase in transactions."
More towers, including Icon, will be released in Jumeirah Lakes Towers in the short-term as well as homes in the Jumeirah Village Triangle and Falcon City of Wonders, all of which will see investors clamouring for tenants. There are, however, still some who chose price over occupancy.
"There are landlords who would rather leave their property empty than rent it for something less, but a lot depends on mortgages and how much they need the money, so this trend tends to be in Jumeirah and Umm Suqeim rather than in areas where people have bought in the past couple of years," said Pitt from Landmark Properties.
Traditionally cheaper areas are still prevailing in popularity with many people looking for units in Discovery Gardens. The vast reduction in rents in Dubai Marina, however, is also luring those for whom it was previously out of reach.
"The increased building activity in recent years will ensure there will not be a shortage in supply of such properties throughout the current year," said Simone Lawrence, Operations Manager for Northern Emirates at Better Homes.
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