Thursday, May 30, 2013

Dubai rental growth leads to increased demand for properties in Sharjah

According to new report by Cluttons, the real estate consultant, the rates of properties are growing fast, partly due to higher rents in Dubai. This in-turn has spurred real estate market revival in Sharjah.

Landlords in the emirate are once again benefiting from the high residential rents in Dubai, and due to influx of people who are being priced out of the market accordingly, says report by Cluttons.

The firm said that the recent launch of a new apartment building in Sharjah indicated that rental rates are close to those seen in 2007. The new Arenco Golden Sands Tower in Al Nahda area of the emirate, now plans to sell apartments for at least Dh.41,000 a year.

Although this tower alone does not necessarily establish the market rate, other properties in the area are available for Dh.32,000 annually. This indicates a major shift in the market.

Further, for those seeking new accommodation, landlords in the emirate are tightening their terms, the report said. Cluttons said that a trend of accepting only a single cheque to cover rent of one whole year, and demanding an additional 20 percent of the annual rate as security deposit, is being noticed among landlords in Sharjah, which comes as further challenge to those seeking new accommodation.

Sharjah is considered as the most suitable alternative to those finding themselves out-priced by the growing rentals in Dubai, with demand surpassing supply for the first time since the global financial crisis. Cluttons anticipates further strengthening of the residential market, and rentals for both apartments and villas set to grow over the next six months.

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