While there are caps on increases for existing occupiers, Dubai currently has no controls on increases for new tenants.
Rentals increased significantly in Dubai during 2013 as Downtown rent jumped by more than 100 per cent and other locations also witnessed more than 30 per cent rise, according to a latest report.With the iconic Burj Khalifa and the world’s largest shopping mall as its centerpiece, the residences at Downtown are a renter’s dream, evident from the area’s ranking amongst Dubai’s most searched locations to rent throughout 2013.
The report revealed that rents gone up significantly in a double-digit in most sought after locations in the Emirate. That’s the reason the Dubai Land Department is planning to limit rent hikes when tenants change and also updating its rental price index. While there are caps on increases for existing occupiers, Dubai currently has no controls on increases for new tenants, according to Land Department General Director Sultan Bin Mejren.
“We are studying laws for residential and commercial properties and each will have its own guidelines,” he said. “We expect to have them prepared in either June or the third quarter. There has to be some regulation for new contracts in order to have stable rental increases,” Mejren told Bloomberg recently.
Property portal Propertyfinder.ae dived into the latest findings from Market Price Live, its up-to-the-minute data centre, to track the rise in rents across Dubai’s key communities in 2013. Last month, the portal also issued its fourth quarter report and revealed that the top five most searched locations to rent property remained the same during all four quarters of 2013. But there was some movement elsewhere on the list.
Dubai Marina, holding its position as the most-searched neighbourhood at propertyfinder.ae since 2012, experienced a 36 per cent increase in rents over the course of 2013. On the other hand, Jumeirah Lake Towers, a constantly developing community offering a quieter lifestyle despite being located just minutes away from Dubai Marina, saw a modest rise of 6 per cent in its rental prices last year.
Lease prices of studios in Palm Jumeirah, surprisingly, showed a slight decline of seven per cent. However, rents of one-bedroom residences grew by 14 per cent in the serene waterfront community, which has consistently appeared in propertyfinder.ae’s top 5.
Dubai Sports City, jumping several notches from 18th position in 2012 to secure 6th spot in Q4 2013, saw a 30 per cent hike in rental prices last year. From state-of-the-art sporting venues and residential and commercial developments together with all the amenities such as international schools, medical facilities, hotels and community centres in a purpose-built city, Dubai Sports City is a current hotspot for investors and renters.
“Whilst it’s impossible to say what’s ‘best’ for everyone, our Q4 2013 report is a good place to start for anyone looking to buy or rent a pad this year as it features trends, prices and statistics from across the market. Given that 2013 was a landmark year for the housing market, the expectations for 2014 are naturally high. With the introduction of the new rental decrees in Dubai and Abu Dhabi, it will be interesting to see how the leasing market pans out over the course of this year,” commented Michael Lahyani, CEO and Founder, of propertyfinder.ae.