Tenants in the UAE’s property market, which is presently witnessing an increased level of investor interest, keep on having the upper hand in negotiations, especially over rental agreements, as per another analysis by real-estate consultancy CBRE.
In a report on Monday, CBRE said that the UAE is “increasingly a tenant-led market, with occupiers having greater bargaining power and flexibility in negotiating with landlords.”
Over the Q1 of 2021, rental rates for residential properties in Dubai kept on their fallen trajectory: villa rents decreased by 2%, whereas the apartment rents fell by 10% in Q1 in comparison to the same period the previous year.
However, quarter by quarter, asking costs have changed across various areas or communities, with renting rates presenting single-digit decreases on twofold digit expansions, as indicated by property management firm Asteco.
Some landlords are still not being able to rent out their properties right away, and tenants are being enticed with attractive terms. “Incentives seen more frequently include rental reductions and the possibility of rental payments in multiple cheques,” said CBRE.
In Spite of a rise in interest from homebuyers, developers are also improving their deals, offering rent-to-own schemes, fee waivers, and attractive post-handover payment plans to draw in investors.
As per the data gathered during the Q2 of the year, Asteco said apartment supply in Dubai accounted for 1,925 units, with remarkable deliveries in communities like Dubai Hills Estate and Dubai Creek Harbour. More units are also predicted to enter the market within the next few months and developers have continued launching new projects.
In Abu Dhabi, almost 1,700 apartments and 50 villas were handed over during the same period. Another 11,600 residential units are predicted to be delivered before the end of the year.
The UAE has seen a rise in the level of homeownership demand, with deals increasing to record levels in recent months. Last April, more than 4,800 Dubai properties, with a total cost of 10.97 billion dirhams ($2.9 billion), changed hands. The deal’s cost was the highest reported in Dubai since March 2017.