Rents start to stabilise in parts of Dubai - index - Real Estate

Tuesday, 12 May 2009 3:07 PM

A flood of tenants into the Dubai rental market has seen prices stabilise in the Marina and even increase in the Springs, Landmark Advisory’s updated index said on Tuesday.

After precipitous rental declines in the final quarter of 2008 and the first quarter of 2009 - driven by the collapse of Dubai’s property market - the new guidelines show that a two bedroom villa in the Springs, a popular residential area in Dubai, rose by AED5,000 to AED95,000 a year.

“In this area, tenants flocked to take advantage of opportunities created by steep rent declines,” said Jesse Downs, director of research at Landmark Advisory, the consultancy division of Dubai-based broker Landmark Properties.

"Those areas where rents have plunged would ‘experience a faster rent rebound as deal-seekers rush in," Downs warned.

“Tenants looking to upgrade should carefully consider their timing in order to balance likely rent discounts with the high probability of competition over available units,” she added.

Landmark’s index comes two weeks after Dubai property watchdog RERA (the Real Estate Regulatory Authority) published the emirate's official rental index.

The indices are used by landlords to set rents, which could fall as much as 70 percent from peak to trough, according to research by Swiss investment bank UBS.

Overall, Landmark’s index showed that rents were still falling, with areas such as Arabian Ranches and Palm Jumeirah seeing some of the sharpest declines.

Landmark’s new lower rent limit for a four bedroom villa on the Palm Jumeirah is now AED270,000 a year, with a two bedroom apartment at JBR and the Marina costing AED120,000 and AED85,000.

Rents for three bedroom townhouses in the Springs are priced at AED130,000, according to Landmark.

Last week Arabian Business obtained details of Landmark’s index before its release and reported that Palm Jumeirah rents would show a 30 percent drop since March.

On Tuesday Arabian Business revealed that house prices on Nakheel’s man made island have fallen below AED800 per square foot for the first time in over three years, representing nearly a 60 percent drop in five months.

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Posted by: macca Sunday, 17 May 2009 1:28 PM[UAE]

No opportunity in the US or the UK, hmmmm I'm not sure a certain Barak Hussain Bin Obama would agree with you. More self made millionaires in the UK and the US than anywhere else. There is a queue of thousand at borders trying to sneak in. Just remind me why people are prepared to risk death , or even marry a cousin to try to get a British passport ? I moved back to Europe after 5 years away, you know what its fantastic. I liked Dubai but its great to be home, fear not !!

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Posted by: The Analyst Saturday, 16 May 2009 6:35 PM[UAE]

"will never think of going back to the UK" your excerpt from your response, no one is telling you to go anywhere, you can go where ever you'ld like but you OBVIOUSLY are clueless as to what global economics and what a financial crisis are. Don't expect your lack of knowledge for global economics to be widespread to other individuals that read Arabiannews.com. Also your statement,"people who were nobody yesterday and Dubai made them 'someobody' , it is you that was a nobody and still is a nobody, when you sling mud it will inevitably come swinging back at you, none of us think we are anybody, it is individuals like you that are always trying to cover the truth because your own fears are consuming you because you were never a somebody but more of a nobody. So...If you would like to make a statement BASED ON FACTS rather than slinging your UNFACTUAL statements, go ahead, otherwise don't bore us with your fears and hidden agendas.. You are probably one of those individuals that couldn't get a job in the UK and were forced to come to Dubai. Others like myself came on our accord out of an invitation to bring our experience to Dubai. Next time get your facts right! Dubai will be delivering over 70,000 units in 3 years, it is in current oversupply and will continue to do so...Your hopeful dreaming will not stop anything OR maybe you just might have been burned playing the game. When professionals have discussions on global economics, take a back seat and listen, IT"S NOT BEING NEGATIVE, it's informing our friends and the public that the financial and especially property sector in Dubai will continue in a downward fashion... Which is great, NOT NEGATIVE NEWS, for the majority of the people in Dubai that have been raped by the greedy landlords. It is time for all the people in Dubai to be able to LIVE and to be able to afford to feed their families while living and working in Dubai. To all my wonderful friends both Emirate and expats, Cheers to all!

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Posted by: Jean Paul Saturday, 16 May 2009 10:33 AM[UAE] - UAE

Why people are so NEGATIVE. It is very strange but traffic is still chaotic in Dubai (are these all Locals????). I still see 90% of the people roaming around in Dubai not waring a local Dress? Who are these pople? Maybe they are all leaving by tomorrow? Come on guys. If people are leaving, what future they have in USA and UK and France and Germany right now where there are more layoffs than anywhere else in the world. Yes, there are layoffs here, people are losing money on property and so forth but tell me a leading country which is not 100 times worst. People love to be negative in this part of the world - people who were nobody yesterday and Dubai made them 'someobody' and they have the face to trash Dubai for giving them such an opportunity that they will never have had in UK, USA, India and so forth. Lets not try to use these columns to take out the frustration because things are going slightly wrong. Yes, we have to bear with it and life goes on, people will still loose jobs, and they eventually will fid new jobs soon hopefully once the situation gets better. Being negative is a very nasty trait..... Wake up guys and smell the roses.... I still believe in Dubai and will never think of going back to the UK where the opportunities right now are ZERO....... Dubai still gives me hope and it will once again, show prove all these negative guy wrong....

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Posted by: The Analyst Saturday, 16 May 2009 4:24 AM[UAE]

Most of the expats have left or will be gone in the next 2 months, retail outlets have slipped into oblivion, hotels and their food & beverage departments have collapsed. Have you seen the new consumer sentiment and spending numbers?? They are down again, people don't have the funds to continue to spend, they are spending on the bare necessaties to feed their families. I'm talking about middle class professional people around the world. There will be over 70,000 units coming into the pipeline, with a potential delay of 10-20%, only for those delayed units to come online in the third year. You think RENTS are low now?? They will continue to plummet. There are no extra people lounging around in Dubai OR Abu Dhabi waiting for these units. The global economic crisis is not upswinging, it is continuing its downward and long standing cycle which will last several years. Companies WILL NOT rehire all the terminated/redundant staff. WHY? Because they are running perfectly well without the extra cost of this labor, thus INCREASING the companies bottom line. It is agreed the world over that we will be in a state of global high unemployment for decades. Everyone, meaning corporations have streamlined and are running as lean, efficient machines. Gone are all those redundant jobs. The world will adapt to a new "hardwiring" on how business and expenses will be transacted. As was written recently, this global economic crisis will send over 1 BILLION individuals back into the depths of poverty and hunger. Yes, over 1 BILLION breathing, living human beings will go hungry in this new era, so when you hear the bull and spin on how infrastructure spending in all these countries will put everything back to where it was, THINK AGAIN! To All those greedy investors/flippers that scarred many global markets, as they say it's PAYBACK TIME, be prepared to be burned, after all you were GAMBLING, like you were in LAS VEGAS, you didn't actually think that you would not get dealt a LOSING hand... it's a fair outcome when you gamble for high returns...with it comes high RISK and ultimately LOSS! Cheers my friends!

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Posted by: Jean Paul Thursday, 14 May 2009 8:20 PM[UAE] - UAE

I agree. Rents in Springs are in fact going up (unless you find a desperate seller who is giving it at a steal and these are not common any more). I am searching hard for three bedrooms villas in springs and would be happy to pay 150K but prices are increasing every day now! If anyone knows of a good deal, please let me know!

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