Estate agents in Dubai believe that rents of residential properties have continued to rise this year despite speculation of a downturn.
Jasmine Ferrer, a property sales consultant for Arabian Homes Real Estate, said: "Rents do vary depending on the location, but on a broad scale, most properties have seen an increase. A two bedroom apartment at one of the residential complexes used to go for Dh75,000 last year and it is now being rented to new tenants for Dh105,000." She added: "New properties will set their rates based on current market prices and since not too many properties are entering the market until 2007, the demand is still high and people can expect that prices will not fall." A large number of tenants who rented property last year have seen an increase that in most cases complies with the 15 per cent rent increase cap set by the Dubai government.
James Grumley from Alpha Properties shares the same perspective on the situation.
He said: "Let me put it this way; a residence at one of the development centres that used to go for Dh90,000 in December 2005 is now being rented for Dh150,000, but people are still very keen on taking it." Grumley believes that as the number of expatriates com ing to reside in Dubai continues to rise, the demand will remain high.
He added: "A large number of people are also offered packages by their employers and most of those companies tend to cover the rents." Commercial properties have also been affected by the rising demand that continues to cater to an influx of international companies keen to secure a location and compete in the business hub of the region.
Omar Al Obaidi, office manager for Pacific Real Estate, said: "In general, any rent property has seen the 15 per cent increase, but with a demand that does not match the supply we have seen commercial property prices increase by a [large] margin.
"An office space that used to be rented for Dh100,000, is now being rented for Dh160,000."