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Dubai rentalsUntil the addition of additional units in the market, based on an industry speculations Dubai rentals may continue to increase in 2014. “I don’t believe there are any prospects of rents decreasing but you will see the leasing progress sluggish and this quarter we’d merely seen a three percent improvement, down from what we found throughout previous years,” stated Pad Green, head of research and consultancy at CBRE Middle-East.

“We will not be expecting to see the same level of increase that we saw in 2013 but rents will rise until enough development comes through and I don’t think that (supply) is occurring in the brief term.”

In accordance with the latest study from CBRE, the emirate’s home rents increased 22% in Q1 2014. This season while villa leases increased 1-5 percent in the first few month flat rents soared 29%, the report said.

Nonetheless, quarter-on-quarter leasing increase slowed to 2.8% in Q1 2014 with apartments increasing only three percent and villas by 2.6%. This trend is expected to continue throughout every season, Green mentioned.

“Now the simple way for rents to fall is sufficient additional units to come in to the market to ensure that people have an option about where to go and stay and what amount of rent they need to pay. It’s standard in any market to permit supply and demand determine rents.”

Around 65,000 new residential components are penned for conclusion over the next few years, according to CBRE. Green stated that the climbing Dubai rental rates, though warranted, may have broader effects on the market.

“Dubai is becoming a pricier place to reside and we must keep an eye on these difficulties. There’s some justification for this as we now have found GDP growth in the UAE and events like Expo have simply accentuated that,” he stated.