Prime residential rents in Dubai flatlined over the last six months of 2014 as the emirate's real estate market continued to stabilise following strong growth in the previous year, Knight Frank said on Wednesday.
Prime Global Rental Index showed that although rents in Dubai increased by 8.1 percent in the fourth quarter of 2014 compared to the year-earlier period, zero growth was register between Q2 and Q4.
"In Dubai the bulk of the 8.1 percent increase in prime rents occurred in the first half of the year. Outside the oil industry tenant demand has proved robust," Knight Frank said in its report which ranked Tokyo as the world's strongest rental market with 11.1 percent year-on-year growth.
Globally, the index saw a notable slowdown during Q4 2014. On an annual basis the index rose by just 0.6 percent in 2014, its weakest rate of growth since 2009.
At 6.5 percent, the Middle East recorded the strongest increase of all the world regions year-on-year.
Moscow, where rents are largely US dollar denominated, saw prime rents plummet by 16 percent due primarily to the weakness of the rouble.
Kate Everett-Allen, partner, Knight Frank Residential Research said: “The weakness of this quarter’s results hides the fact that 12 of the 17 cities saw luxury residential rents increase or remain static in 2014.”
Last month, Knight Frank said house prices in Dubai had slumped by more than six percent in the past six months.
Its Global House Price Index showed that between the end of June and end of December 2014, prices fell by 6.2 percent, making it the worst performing real estate market of 55 tracked by Knight Frank.
The index also said that Dubai house prices rose marginally by 0.8 percent over the past 12 months and dropped by one percent in the final quarter of 2014.For all the latest real estate 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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