The downward trend of apartment rental prices in Dubai continues. According to the latest data from real estate website Bayut, the average rental price for a studio apartment in the city was AED57,000, meaning that it has fallen by six percent since the start of the year.
This means that apartments are becoming more affordable, with overall rents across the city falling by an average of two percent in July.
The average rent for a one-bedroom was AED92,000 last month (down seven percent), while two-bedrooms were AED145,000 (an adjustment of two percent). Apartments with three-bedrooms fetched an average of AED206,000, which is fairly similar to the going rate at the beginning of the year. According to the rental value of a four-bedroom has dropped slightly to AED304,000.
Despite these adjustments, Bayut has said that the real estate market is still strong, and that rental yields can be as high as 6.5 percent in some areas.
Bayut said: "At a time of general global slowdown, the performance of UAE's realty market continues to inspire trust in investors. Both Dubai and Abu Dhabi continue to be safe havens for global realty investors and the increasing prospects of Sharjah's real estate sector provide yet another avenue for parking international wealth in a quickly developing market.
"Though rents have seen periodic adjustments, Bayut believes the UAE's unique selling propositions such as a highly smart, diversifying economy, security of investment and the great promise of Expo 2020 will keep the real estate and its allied sectors thriving in the months to come."
This is in line with an earlier report from Cushman & Wakefield Core, which predicted that the rental prices would continue to fall, before bottoming out towards the end of the year.
“This has very much been a self-fulfilling prophecy until now where most investors believe the market should see another six months of price declines, which in itself has translated and still translates into more downward pressure,” Cushman & Wakefield Core CEO David Godchaux said in a press statement. “Reversely, we are now witnessing a growing pool forming of investors and renters who are anticipating a balance in price and increase by the end of 2016, which is a strong stabilising factor, as many have shown they are ready to transact now if they believe that the price is right.”
So if you’re a property owner, it seems that there’s no need to worry about the rental value fluctuations. And if you’re renting, it’s a good idea to take advantage of the slightly lower prices while you can.