Luxury One Real Estate September 2, 2023 0 Comments

Dubai rents increase significantly, as the UAE population booms.

As more inhabitants aspire to purchase real estate, a big move for the formerly very transient city, experts have told Arabian Business that they do not expect Dubai rent prices to decline very soon.

As a result of the emirate’s rents reaching 2016 market peak levels, tenants are under more financial strain. Many people have been compelled by this to look for less expensive alternatives, like relocating to less populated areas or purchasing property, as opposed to continuing to pay exorbitant rent charges. Rents first rose in high-end market segments in prestigious communities like Downtown Dubai and the Palm Jumeirah, but have since stabilized a little bit relative to the rate of rent growth in other places.

“What we are seeing is that tenants are choosing to stay in their current place, even though they might want to move. Something they might be looking at is the differential rent between new rents and their existing rent – the level is so significant that that’s actually forcing landlords to reduce their price expectations,” Khan explained.

He predicted that rents will eventually stabilize after a few more months, but that rents will continue to grow for the more cheap mid-market group.

He said that this might be “bad news” for tenants. As a result, consumers will have to actively think about where they are located as opposed to earlier years when “they may have been fortunate enough to live in some very core locations” and the market was more accessible, such in 2020 and 2021.

“However, because of this, regions that were previously considered to be more affordable are suddenly becoming quite desirable. And as you well know, this will entice investors to make additional investments in these sectors. Therefore, both good and bad things exist.

According to a research issued by Property Finder last month, rents for apartments increased by 19 percent and rents for villas by 25.5 percent during the second quarter of this year.


Source : Arabian Business & Property Finder

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