Rents in most of Dubai’s residential communities have dropped, according to the most recent update to the emirate’s rental calculator by the Real Estate Regulatory Authority.
A quick review of the rental calculator, which is updated annually, showed that rents across most freehold residential communities in Dubai had declined marginally.
Dubai Marina, one of the most popular areas for Western residents, registered a year-on-year fall in rents in January. The maximum rent for a one bedroom unit fell from Dhs 120,000 in 2015 to Dhs 110,000, down by 8.3 per cent. Two bedroom apartment rents in upscale areas within the neighbourhood also declined by 5.5 per cent to between Dhs 140,000 and Dhs 180,000, down from Dhs 140,000 to Dhs 190,000.
Elsewhere, rents for studio, one bedroom and two bedroom apartments in Jumeirah Lakes Towers fell overall in 2016. Rents for a studio apartment in the area ranged from Dhs 55,000 to Dhs 70,000, compared to Dhs 55,000 to Dhs 75,000 in January 2015. Leasing rates in the upper segment of one bedroom apartments also fell by 5 per cent in 2016 to Dhs 95,000, from Dhs 100,000 last year. Meanwhile, the maximum rent that could be charged for a two bedroom apartment fell by 10 per cent from Dhs 150,000 in 2015 to Dhs 135,000 this year.
Rents for one-bedroom apartments in Business Bay ranged from Dhs 80,000 to Dhs 105,000, compared to Dhs 90,000 to Dhs 110,000 during the same period last year. Two bedroom apartment rents in the area also fell marginally to between Dhs 110,000 and Dhs 140,000, from Dhs 120,000 to Dhs 140,000 last year.
Apartments in freehold communities such as Jumeirah Village and Dubai Silicon Oasis did not see any movement in rents. Studio and one-bedroom apartment rents in The Greens and Motor City also remained the same but rates for two bedroom apartments in both areas declined slightly.
The rental declines come as the emirate’s property market face headwinds due to falling oil prices and slower economic growth.
According to a report by property consultant CBRE, average residential sales in Dubai fell 16 per cent and 14 per cent year-on-year for apartments and villas respectively during the fourth quarter of 2015. Overall unit transactions declined by 33 per cent year-on-year, according to the report.
The property sector is braced for a further slowdown this year as falling oil prices and sluggish economic growth squeeze investments into real estate, consultant JLL said in an earlier statement.