Rents in some of Dubai’s most popular areas have fallen by about 30 percent in the past year, according to the latest data published by the emirate’s property regulator.
Apartment rents in Dubai Marina, Palm Jumeirah, Discovery Gardens, and Jumeirah Beach Residences have all seen significant declines, according to the Real Estate Regulatory Agency.
Prices for a one-bed apartment in Discovery Gardens, which houses about 41,000 mainly expats, currently stand at AED40,000-50,000 in the latest index, compared to AED55,000-65,000 a year earlier, more than a 30 percent drop for the minimum value.
The Rental Index is designed to give landlords and tenants in the emirate a guideline to pricing rents when negotiating contracts. The index is presented in the form of an online rent calculator on RERA’s website.
Dubai Marina, which is consistently voted the most popular for would-be buyers and tenants, also saw big rent declines.
Rents for a studio in the Marina start at AED35,000, down AED10,000 compared to the March 2010 index, while minimum rents for a one-bed have fallen more than 30 percent to AED45,000.
Apartments on Palm Jumeirah have also witnessed a significant drop, with minimum rents of AED60,000 quoted, compared to AED90,000 in March last year.
Two-bed minimum values on the man-made island have also dropped by AED40,000 to AED90,000, RERA said in its online guide which takes the form of a rent calculator.
Twenty percent-plus declines were also seen in The Greens where the top price for a two-bed has fallen from AED130,000 to AED90,000.
Rents also dropped in Jumeirah Beach Residence (AED5,000 decline on one-beds) and in Jumeirah Lake Towers where minimum costs of a studio fell by AED12,000 to AED28,000.
Studio apartments in International City were among the lowest rental values, according to the RERA guide, starting at just AED15,000, down AED10,000 from March 2010.
Villa rents have also declined in the past year but some areas have witnessed a stabilisation in values, the RERA guide added.
Rents for a four-bed villa on Palm Jumeirah (at AED300,000-350,000) remained the same as in March 2010, as did values for a three-bed villa in The Meadows (AED170,000-210,000).
However, other areas of Dubai still saw declines with the minimum rent for a two-bed villa in The Springs down AED20,000 to AED70,000.
Minimum rents for a four-bed villa in Arabian Ranches now start at AED160,000, 25 percent lower than in March last year.
Despite the drop in property values, construction work continues apace across the emirate.
As many as 48,000 homes will be completed in the next two years, increasing current supply by 12 percent, Landmark Advisory estimates.
London-based real estate broker Cluttons predicts that 35,000 will be completed through 2012, prolonging the price slump for another 18 months.