Villas in Sharjah have continued to buck the wider trend of retreating rents in the emirate’s residential rental market, according to a new report by consultancy Cluttons.
Villas recorded an increase of 1.7 percent, taking the overall residential rate of growth to 0.4 percent during the last quarter of 2017, the report said.Cluttons’ Sharjah Property Market Snapshot for Spring 2018, showed that over the last two years, Sharjah’s villa market has grown in both profile and popularity as the real estate market repositions itself with new and affordable options.
This trend is helping retain the emirate’s appeal and attractiveness amongst those households that have been priced out of Dubai, or are seeking a more family oriented lifestyle, the report noted.Suzanne Eveleigh, Cluttons’ head of Sharjah, said: “Communities such as Al Zahia have been a runaway success and with most major new shopping mall developments in Sharjah anchoring these new lifestyle destinations, the future of community living in the emirate appears relatively buoyant, especially when compared to many other property segments in the UAE.”In contrast to the villa market, apartment rents in Sharjah registered a steep decline of 13.6 percent in rents.
Cluttons’ research shows that Abu Shagara topped the list of weakest performers, with rents retreating by an average of 15.1 percent during 2017.According to the report, Sharjah’s residential rental market is set to face pressures from rising stock, which is helping to cement the tenant’s market that took hold three years ago.
“Many landlords are reluctant to adjust advertised rents downwards due to concerns about alienating existing tenants. However, with tenants increasingly seeking out new and energy efficient buildings, reflecting household financial pressures stemming from the 1 January introduction of VAT, rising utility bills as subsidies continue to be phased out and rising inflation levels, we feel landlords will need to be flexible with rents and the payment plans, particularly in older buildings, to sustain demand,” added Eveleigh.Faisal Durrani, head of research at Cluttons said: “With sudden turnaround in economic growth, or residential demand unlikely to increase during 2018, Cluttons expect rents will continue to moderate, with apartments likely to see corrections of 5-7 percent next year, while villa rents are expected to experience growth of between 1-2 percent.
“This makes Sharjah’s villa market the only property segment in the UAE to see sustained positive growth.”
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