Sharjah residents chase prime spots
Newer developments are bucking the trend of slower rental growth
Sharjah’s residents are on the lookout for quality living. And it is starting to tell on the waiting lists landlords are able to generate.
“Well-managed buildings that are perceived to offer better quality and increased facilities still have longer waiting lists than lower quality buildings and continue to drive demand,” said Faisal Durrani, Head of Research at Cluttons, the property firm.
On the rental side, the latest Cluttons report suggests the pace of rental growth in Sharjah is starting to subside, with the third quarter recording to a “marginal 0.3 per cent increase”. On a year-on-year basis, rents are “1.6 per cent below this time last year”.
This goes against the general belief that Sharjah’s residential space has seen steady upward pressure on rentals as erstwhile Dubai based residents seek new homes at lower leases.
Shorter commute
But Cluttons takes a contrarian view. “Rising supply levels across many areas of Sharjah, coupled with price reductions in Dubai offering a shorter commute and increasing value for money in Ajman are starting to undermine rents,” Durrani said.
The report adds, “This is the first time in over two years that average annual residential lease rates have contracted, but demand still remains for high quality stock and gated community living.”
But the newer communities and villas continue “to outperform the wider residential market, particularly apartments, with rents rising by 4.1 per cent during the first nine months of 2015’. Developers too are focussing their attention on this category, with the Dh20 billion Sharjah Waterfront City, expected to deliver 1,500 villas.
According to Suzanne Eveleigh, Property Management Director at Cluttons, “We’re experiencing a rise in the popularity of gated community living, and the relative affordability of Sharjah’s villa communities is helping to sustain the steady level of tenant requirements.”
Rising supply levels across many areas of Sharjah, coupled with price reductions in Dubai offering a shorter commute and increasing value for money in Ajman are starting to undermine rents.” Cluttons