The variation and severity of adjustments in rental rates depended largely on the size, location, accessibility and quality of the flats, with prime areas able to resist the downward trend in rents better than secondary or less desirable locations, the survey found.
Clients are expecting further discounts on current rentals and flexibility on payments, as more properties are available in different areas like Jumeirah Lake Towers, Al Warqa, Discovery Gardens and Dubai Investment Park, Asteco said in a note.
Now the short-term tenancy contracts are talk of the town as more people looking for these contracts instead of year-long leasing contract. In the last two months, estate agents have noticed a spike in the number of people looking for short-term rentals.
“A lot of our clients want to rent on a month-to-month basis because they have either lost their jobs or their current jobs are unstable,” Martha Fitzharris, assistant operations manager at Better Homes, a property firm deals in both residential and office segments.
According to Asteco, average annual rents for cheaper studio apartments in International City, Discovery Gardens, Jumeirah Lake Towers, Deira and Dubai Marina fell to Dh26,000 from Dh28,000 in August, but more expensive studios in these neighbourhoods were unchanged at Dh40,000.
Rents for smaller single, two-bedroom and three-bedroom units were unchanged at Dh38,000, Dh60,000 and Dh90,000 respectively while larger single, two-bedroom and three-bedroom flats in the same area were same at Dh65,000, Dh85,000 and Dh110,000 respectively.
Smaller two and three-bedroom apartment rents in mid-tier neighbourhoods witnessed some decline while larger segment for the same remained unchanged during September. Therefore, average annual rent in Bur Dubai, Al Barsha, Greens, Jumeirah Beach Residence and Dubai Marina for same category went down to Dh70,000–90,000 from Dh75,000–95,000 in August. Rents for studios and one-bedroom flats in the mid-tier category were unchanged at Dh35,000 to Dh50,000 and Dh55,000 to Dh75,000 in September.
The apartment rents in top-tier locations such as Palm Jumeirah, World Trade Centre Residences, Sheikh Zayed Road and Downtown Burj Dubai remained unchanged. The average rents of studios in this category stood in the range of Dh50,000 to Dh60,000 in September, while one-bedroom apartments were leasing in the range of Dh85,000 to 120,000. Two-bedroom and three bedroom apartment rents stood at Dh120,000 to 160,000 and Dh160,000 to Dh210,000 respectively.
Office Rents
The average annual rent for the premium locations such as Dubai International Financial Centre went up 23 per cent during September while a sharp decline of 25 per cent noticed at Sheikh Zayed Road. Demand is rising for the units closed to metro stations. According to Asteco, the level of enquiries increased in September for the office near metro stations and demand is also rising for smaller units. Enquiries are gradually increasing and many businesses have planned to relocate their business to new buildings with higher rates.
The average annual rent also went down in mid-tier neighbourhood up to 15 per cent. In Jumeirah Lake Towers and Bur Dubai it went down Dh60 per square foot compared to Dh65 in August while Tecom, Downtown Jebel Ali and Festival City fell to Dh170 per square foot from Dh200 in August.
