Palm Jumeirah villa rents rose 7% in Q3

Rents for villas on the Palm Jumeirah rose seven per cent while lease rates for apartments on Sheikh Zayed Road increased six per cent in the third quarter of 2012 compared to the last quarter, according to Asteco.

Quality residential developments continued to perform better with average overall rental increases of two per cent for apartments and three per cent for villas, the real estate consultancy said in its Q3 report.

However, residential sales prices were relatively unchanged despite increase in number of units being advertised, but at inflated prices. Commercial property market remained subdued due to lack of demand.

Rents for a two-bed apartment on Sheikh Zayed Road rose six per cent to Dh105,000 per year, while Downtowm Dubai saw an increase of four per cent to Dh120,000.

Among the villa communities, Palm Jumeirah rents rose a seven per cent with a three-bedroom unit renting for Dh325,000 per annum on average, up from Dh300,000 per year.

The Springs and the Arabian Ranches were next in line with increases of five and four per cent respectively. Three-bedroom villas were leasing for Dh125,000 per annum in the Springs compared to Dh120,000 in the first half of 2012 while similar properties in the Arabian Ranches were leasing for Dh145,000 per annum (Dh140,000).

“The increasing rental rates are due to the lack of a certain unit type, whether that is larger three-bedroom units in towers or smaller townhouses in villa communities,” said Elaine Jones, CEO, Asteco.

Emerging communities such as Jumeirah Village saw rent hike primarily due to improvement in infrastructure, landscaping and retail offerings.

Sales prices remained stable after the steady increases recorded at the beginning of the year. The summer coinciding with Ramadan resulted in lower enquiry levels and no significant pickup.

Dubai Land Department data revealed that property transactions reached Dh2.2 billion in August alone, slightly higher than the same period last year.

Apartment sales were relatively unchanged since the second quarter. The Greens recorded a three per cent increase, rising to Dh8,800 per square metre.

Apartment sales prices in Dubai International Financial Centre and Palm Jumeirah, are still the most expensive areas, both commanding Dh14,000 per square metre.

Palm Jumeirah is still the most sought after with villas changing hands for Dh17,200 per square metre compared with Dh5,400 per square metre in Jumeirah Village.

Dubai real estate market consists of 402,800 apartments, 58,300 villas and 9.1 million square metres of office space. Around 11,600 apartments, 6,100 villas and 770,000 square metres of office space are expected to be delivered in the second half of the year.
 

Follow Emirates 24|7 on Google News.