Dubai: Still spending half of your salary on rent? Dubai tenants looking to cut down on housing expenses would be well advised to consult the latest rental rate data.
While some landlords may be looking to pocket higher yields, new research suggests that several communities in Dubai could offer some relief this year, especially if they are newly developed and the supporting infrastructure and basic amenities are still quite limited.
Apartment rents have declined by 5 per cent since the last quarter and 6 per cent over the year, according to a report. Rental declines were noted in various apartment types, from affordable, mid to high-end units, with certain areas offering tenants as much as Dh13,000 in savings per year.
Both high-luxury and affordable accommodation registered a rental decline of 6 per cent in 2016 compared to a year earlier, while mid-high end units posted a 7 per cent drop.
The locations that registered the biggest drop in rental rates for one-bedroom apartments in 2016 are Jumeirah Village, Jumeirah Lakes Towers (JLT) and Dubai Sports City, where flats posted annual price reductions of 17.8 per cent, 16.7 per cent and 12.1 per cent, respectively, according to the data from Asteco.
A clear winner in terms of providing the biggest rental cuts, Jumeirah Village now has flats that can be leased for Dh60,000 per year, down from the Dh73,000 average rate recorded a year earlier.
In JLT, a cluster of mid to high-end apartments, tenants can secure one-bedroom flats for Dh75,000 annually, about Dh15,000 cheaper than the average rate in 2015.
Residents opting to live in Dubai Sports City can still find apartments that cost Dh65,000 a year, down from Dh73,000 in 2015.
In terms of annual rental rates, however, International City remains the most affordable location, where rents for one-bedroom units have dropped from Dh50,000 to Dh45,000. Jumeirah Village and Deira came second on the most budget-friendly list, with rents dropping to Dh60,000 on average.
For two-bedroom flats, the biggest rate cuts were reported in Dubai Sports City with rents falling from Dh105,000 to Dh90,000, on average.
Dubai Marina also offers some cost savings to families looking for two-bedroom properties, as rents in the area slipped from Dh143,000 in 2015 to Dh125,000 in 2016.
Although it may be considered one of the luxury communities in Dubai that caters to wealthy residents, the Palm Jumeirah is also offering huge price reductions, with annual lease rates dropping from Dh198,000 to Dh175,000, registering an 11.6 per cent decline.
A closer look at the rental rates, however, would reveal that International City is still the best choice for tenants looking to make a saving on rents. Annual lease rates for two-bedroom flats in the area are the lowest in the emirate at Dh63,000 per year, which dropped by 3 per cent from Dh65,000 in 2015.
Communities with biggest decline in rent:
One-bedroom apartment (2015 vs 2016 rates)
Jumeirah Village: -17.8 per cent, from Dh73,000 to Dh60,000
Jumeirah Lakes Towers: -16.7 per cent, from Dh90,000 to Dh75,000
Dubai Sports City: -12.1 per cent, from Dh50,000 to Dh45,000
Bur Dubai: -11 per cent, from Dh73,000 to Dh65,000
Discovery Gardens: -9.7 per cent, from Dh72,000 to Dh65,000
Two-bedroom apartment (2015 vs 2016 rates):
Dubai Sports City: -14.3 per cent, from Dh105,000 to Dh90,000
Dubai Marina: -12.6 per cent, from Dh143,000 to Dh125,000
Palm Jumeirah: -11.6 per cent, from Dh198,000 to Dh175,000
Greens: -9 per cent, from Dh143,000 to Dh130,000
Downtown Dubai: -5 per cent, from Dh175,000 to Dh160,000
Cheapest locations:
1 bedroom (2016 rates):
International City: 45,000
Jumeirah Village and Deira: Dh60,000
Dubai Sports City and Bur Dubai: Dh65,000
Al Barsha and JLT: Dh75,000
Business Bay: Dh85,000
2 bedroom (2016 rates)
International City: Dh63,000
Deira and Discovery Gardens: Dh85,000
Jumeirah Village and Al Barsha: Dh95,000
Bur Dubai: Dh100,000
Jumeirah Lakes Towers: Dh115,000
For information on the real estate sector, within the UAE, please visit our sister site, GNProperty.com.
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