Plunging rents in dubai

Lower demand and oversupply is leading to plunging rents in both the residential and retail property markets in Dubai...

The cost of renting in Dubai has fallen by up to a third in the last two months, according to figures from real estate agents and retail leasing costs are expected to soar according to a new report.

The drop in residential rents is due to homeowners flooding the leasing market amid a lack of buyer demand. Rents for villas and apartments have plunged up to 33 per cent in some of the city's most prestigious locations including downtown Burj Dubai and the Palm Jumeirah.

Nehad Abdelhamit, leasing consultant for broker Dubai Waterfront Properties said annual rents for two-bedroom villas in the Springs had seen a 32 per cent drop.

On the man-made island, the Palm Jumeirah, Abdelhamit said some of the biggest seven-bedroom signature villas were now 33 per cent cheaper to rent.

'Most of the properties are not selling, so they are renting them instead to secure an income. People have got mortgages to pay,' she said.

Louise Pitt, Director of leasing at broker Landmark Properties also said two-bedroom villas in the Springs have come down in the last six weeks, with the same sized properties in the Meadows seeing similar falls.

Farida Khan, a Leasing Consultant also at Dubai Waterfront Properties said two-bedroom apartments at developer Emaar's flagship Burj Dubai project had tumbled in price. 'There is so much stock available and much less demand,' she said.

In the retail sector oversupply of shopping mall space is set to force Dubai leasing rates down, according to a new report.

Over the next two years retail space in Dubai is expected to increase by 50per cent to over three million square metres, which may not be sustainable, particularly in today's gloomy economic climate, according to a Better Homes review of commercial space in the emirate.

Source: www.propertywire.com