Dubai rents continued to plunge in July on weaker demand and increased supply – but some areas saw rates rise as tenants upgraded to bigger properties, a new report found on Wednesday.
With relocations on the increase as rates become more affordable small pockets of Dubai saw ‘marginal rent growth’ such as three-bedroom villas in Arabian Ranches.
Meanwhile, rents were falling in other areas “considerably”, real estate consultant Landmark Advisory said in its July leasing guide.
Annual rents for two-bedroom villas in Arabian Ranches fell up to AED20,000 over the last month But rents for three-bedroom villas in the same area rose by AED10,000, with five-bedroom villas jumping as much as AED 50,000.
Price increases were also seen at high-quality build villas in prime locations such as Jumeirah Islands and the Greens – as people looked to upsize.
Jesse Downs, director of research at Landmark Advisory said rents fell at larger apartments as tenants moved out of shared accommodation into single properties or studios.
Studio apartments at Jumeirah Beach Residence (JBR) saw rents climb by AED10,000.
Rents and property prices have dived in Dubai since autumn last year amid a real estate collapse.
Downs said it was too “early to call a price floor” – a sign that rents are likely to drop further in the emirate. It has been reported that property prices could fall by another 20 percent this year.
Despite weakened demand from job losses and expatriates returning home, relocations from Abu Dhabi and Sharjah were holding up rents in some areas.
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