Rents have fallen by an average of 11 percent across property markets in the Northern Emirates over the past year, according to a new report by Asteco.
Its Northern Emirates Real Estate Report Q1 2018 said the most significant drop was recorded in the Rolla area in Sharjah and for high-end units in Ajman.
Apartment rental rates across the Northern Emirates witnessed an average decrease of 1 percent since the previous quarter, Asteco said.
It added that studios to three-bedroom apartments in Sharjah and Umm Al Quwain reported a decline of 1 percent over the quarter, while over the course of the year, rentals dipped by 10 percent to 13 percent and 11-12 percent respectively.
In Ajman, rents for affordable housing units fell by 1 percent in Q1 and by 12 percent year on year.
High-end inventory saw a drop of 3 percent over the quarter and 11 percent between Q1 2017 and Q1 2018. Studios to three-bedroom apartments in Ras Al Khaimah and Fujairah recorded declines of 1 percent over the quarter, and over the course of the year, rentals dipped by 10 percent and 13 percent respectively for affordable housing units.
Meanwhile, high-end units reported an annual decrease of 8 percent in Ras Al Khaimah and 10 percent in Fujairah.
John Stevens, managing director of Asteco, said: “We expect a further pressure on apartment rental rates, as recovery rates in the Northern Emirates are directly impacted by the delivery of supply in Dubai.”
He added: “The launch of residential developments is on the rise in the Northern Emirates, with projects spanning a total of over 100 million square feet of land area scheduled for completion by 2025 in Sharjah alone.”
Sharjah apartment rental rates across various locations decreased by 1 percent on average in Q1 and by 12 percent year-on-year.
The most significant drop of 4 percent was recorded in Rolla, whilst rates remained unchanged over the quarter in areas such as Abu Shagara, Al Butina, Al Yarmook and Al Wahda. Annually, records show rental rates fell by 14 percent in Al Wahda, 13 percent in Abu Shagara, 9 percent in both Rolla and Al Yarmook, and 7 percent in Al Butina.
Stevens said: “The recently implemented legislation that allows non-Arab nationals without a UAE residency visa to purchase properties in Sharjah on a 100-year renewable lease is expected to stimulate demand and ultimately increase foreign investment in the real estate market.
"In addition, continued efforts to develop the private sector and emphasis on diversification strategies are anticipated to strengthen the economy and shape a favourable environment for job creation, business growth and investment.”For all the latest business news from the UAE and Gulf countries, follow us on Twitter and Linkedin, like us on Facebook and subscribe to our YouTube page, which is updated daily.
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