On May 13, DubaiChronicle.com published an article exploring the probability of rents in Downtown Dubai to fall during the coming summer months. A week later, the grim reality proves the analysis wrong. Rents in Downtown Dubai are falling faster than expected due to freshly released tremendous supply of new spacious units in modern and well equipped, centrally located towers.
After combing throught classifieds ads for hours, here we share some of the available data concerning rents in Downtown Dubai:
The lowest possible rent for a brand new studio of approximately 500 sq ft is 58,000 Dhs right now. There are multiple free units in Burj Views, the Lofts, Standpoint and the rest of the newly opened towers.
The lowest rent for 1 bedroom apartment is at present 75,000 Dhs. This quotation is given mostly for the brand new supply. Interestingly, owners of similar units in the older building such as the Burj Views and the Old Town district’s multiple four story buildings are still trying to keep higher rents or they are not aware of the newly released cheaper units. But even in the Old Town, the firm rent of 100,000 Dhs for one bedroom, wich was somewhat constant during the past few months, now is reduced to 90,000 Dhs and even 85,000 Dhs. In addition to the new supply in the brand new towers, tremendous number of units is available in all buildings in the area, including: Lofts, The Residences, South Ridge, the Old Town and the Old Town Island district.
Two bedroom apartments are less in demand and apparently also less in supply. Rents vary greatly due to the size of the units, floor and view. Generally speaking, the lowest rent for two bedroom in Downtown Dubai now is 110,000 Dhs. On the contrarian side, one can find listing for two bedroom apartments with a rent tag of 190,000 Dhs.
This current situation, which by the way is very favorable for tenants, most probably would continue for over a year. Approximately 2000 new units are already partially handed to their owners. The rest will be also released soon. Therefore, rents in Downtown Dubai are expected to slide further and would most probably reach new lows in the summer monts due to traditionally slow business activity in the region.
Prospective tenants should look for distressed flash deals, which are usually asking for 5,000 Dhs lower than the regular rent. Such deals are often posted by struggling with mortgage payments landlords and do not last long. Another available beneficial option for tenants is the possibility to pay on monthly basis by providing the landlord with 12 cheques. Already, few such offers are on display on the classifieds sites. In all cases, tenants now have the upper hand in the rent negotiations and should get advantage on the opportunity by bargaining hard. Remember, whatever rent you manage to negotiate right now, it will be applicable also to your rental contract next year!
