House rents fall as in­creased sup­ply gives tenants lever­age to ne­go­ti­ate

Muscat Daily - - FRONT PAGE -

Ex­ist­ing as well as new tenants are ne­go­ti­at­ing good deals with land­lords as house rents con­tinue to fall across the coun­try. Real es­tate agents are of the view that this trend is likely to con­tinue in the near fu­ture.

The fall in rents has cre­ated a lot of buzz in the real es­tate mar­ket with tenants tak­ing ad­van­tage of the sit­u­a­tion, go­ing for bet­ter op­tions. “The rents have gone down be­tween 15 and 20 per cent in many ar­eas. This has given peo­ple an op­por­tu­nity to ne­go­ti­ate with their land­lords or look for other op­tions as new build­ings keep com­ing up,” Sal­man Jalil, head of property di­vi­sion at Al Balushi In­vest­ments, told Muscat Daily.

He said that the mar­ket is now 100 per cent in favour of tenants and buy­ers. “Tenants are get­ting fair deal for new prop­er­ties forc­ing old build­ings to re­main va­cant. There are many op­tions avail­able now and this has af­fected the real es­tate mar­ket in gen­eral. We do not fore­see any quick re­cov­ery,” Jalil said.

Ja­gruti Nar­a­vani, sales and busi­ness de­vel­op­ment man­ager, ERA Al Osool Real Es­tate, too agreed with this new trend. “We have seen 20 to 30 per cent de­cline in rents last year as com­pared to 2016. The in­crease in the num­ber of new build­ings that have come up is the cause and that is push­ing the rents down. The de­mand has picked up in Septem­ber be­cause every­one is back af­ter their sum­mer hol­i­days but the rents are still down.”

Many tenants Muscat Daily spoke to said that the sup­ply has been much more than the de­mand, giv­ing them the lever­age to ne­go­ti­ate bet­ter rents even in prime ar­eas. An­war Ab­dul­lah had ear­lier rented an apart­ment for RO250 in an old build­ing in Ruwi. Now, he is happy to rent an­other apart­ment of sim­i­lar size in a new build­ing for much less. “The build­ing man­age­ment re­fused to rene­go­ti­ate the rent. So, I de­cided to move on. This year I got a sim­i­lar-sized apart­ment in Amerat for just RO150.”

Christo­pher Steel, man­ag­ing part­ner at Sav­ills Oman, said the real es­tate sec­tor is strug­gling to re­cover. “The re­cov­ery of the real es­tate sec­tor has been longer that ex­pected. We do not see any sig­nif­i­cant im­prove­ment in the next few years. Over­all, the mar­ket has been the same this year as 2017 with less de­mand.”

We do not see any sig­nif­i­cant im­prove­ment in the next few years Christo­pher Steel

Pho­to­graph for il­lus­tra­tive pur­pose only

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