Dubai tenants look to Jumeirah Village Circle amid soaring rental prices

Jumeirah Village Circle in Dubai was the most popular neighbourhood for tenants looking for affordable housing in the emirate.

This was the case even as rental costs in the area, located south of Dubai, increased by 7 percent to 16 percent, averaging at AED34,000, AED48,000 and AED70,000, for studios 1-bed and 2-bed units, respectively, according to data from Bayut and Dubizzle.

Al Nahda, Bur Dubai, Business Bay and Deira have also emerged as popular areas for affordable housing in the emirate, showing an increase from 2 percent to 21 percent.

The report showed increases of up to 21 percent for prices of “reasonably-priced” rental apartments in the Dubai’s most searched areas, while costs for luxury flats have gone up to 43 percent.

The rise is due to the “healthy demand for property in both the affordable and luxury segments of the market,” Bayut and Dubizzle said in a statement, which is mainly seen among global investors and expatriates.

“Over the first half of this year, many pivotal changes have been taking place both within the region and globally. With the focus on safety and security being understandably high, Dubai has stood out as an appealing option particularly for international investors and expat owners,” said chief executive officer of Bayut and Dubizzle and head of EPMG MENA, Haider Ali Khan.

He also explained that within Bayut and Dubizzle, over 35 million sessions were conducted in the last six months with property seekers interested in Dubai's real estate.

In terms of affordable villas, Mirdif has emerged as “the most preferred area,” the report said, with the rental prices seeing a rise at 7 percent. The suburban areas of JVC, Dubailand and The Springs have also sought the attention of tenants, despite a 29 percent increase in rental prices.

A moderate fluctuation of 5 percent was seen in DAMAC Hills 2 where rental costs for four and five-bed units rose, while the prices for three-bed units remained the same.

Rental prices of luxury apartments, villas

Tenants also sought expensive rental apartments and luxury villas in the Dubai Marina (pictured) and Al Barsha of the emirate, with Al Barsha reporting a 15 percent rise in four and five-bed units.

Over the first six months, rental prices for flats in Dubai Marina rose from 16 percent to 22 percent, the report said, with an average cost of a one-bed unit priced at AED 88,000 on an average.

Rental costs at Downtown Dubai also rose from 3 percent to 43 percent due to the increased number of Elite Downtown Residence and Armani Residence properties, listed for rent. Rental flats at Palm Jumeirah also saw a 22 percent rise, over the six months.

Jumeirah Beach Residence (JBR) saw a staggering growth in rental prices for one and three-bedroom units, whereas two-bedroom apartment rates declined under 3 percent, the report said.Jumeirah also continues to attract high-income tenants looking out for luxury villa rentals as prices have increased from 14 percent to 17 percent.

Dubai Hills Estate, Umm Suqeim and Arabian Ranches has also caught the attention of property seekers, as villa prices rose from 4 percent to 30 percent.

Rental yields for investors

In terms of rental yields over the past six months, affordable apartments at Dubai Sports City (pictured) has emerged as profitable with an 8.04 percent growth in yields.

Dubai Marina and DAMAC Hills showed a return-on-investment of 6.97 percent and 6.53 percent, respectively, over the first six months, the report said. Arabian Ranches 2 saw a 6.12 percent rental returns as well.

The report also said that sales prices for villas and apartments in the most searched for locales of the emirate has seen a rise from 1 percent to 19 percent.

JVC continued to be the most attractive option for prospective investors for reasonably priced flats, whereas Dubai Marina remained popular for luxury apartment sales.

Through this data, Khan also emphasised on that the real estate market needs to be “transparent and technologically advanced.”

He added: “We too have launched our next generation property search experience, Search 2.0 on Bayut to allow people to have a more well-rounded and thorough browsing experience that factors in their two most important commute points.”

The real estate sector is most likely to see high rise in prices in the coming months too, he said.

Credit & Source: https://www.arabianbusiness.com/money/wealth/money-wealth-real-estate/dubai-tenants-look-to-jumeirah-village-circle-amid-soaring-rental-prices