Where are real estate rental prices headed post covid-19

Among many consequences of COVID-19 outbreak was a number of job redundancies followed by 10% of residents leaving the UAE, according to some statistics. Consequently, many homes are now vacant. This led to a drop in rental prices in Dubai. This is great news for those looking for villas or apartments to rent in Dubai, but not for the landlords. “Prices have obviously come down considerably. For example a 2-bedroom plus maid’s room apartment on Palm Jumeirah’s Shoreline that would have been rented for AED 110k pre-COVID-19, we have just rented out for AED 85k”, says Emma Jayne Main, Leasing and Property Management Director at AQUA Properties.

Tenants Are Switching Home

Ongoing COVID-19 pandemic and lockdown we faced earlier this year forced many residents to reconsider their living situation. Many of them decided to move from apartments into villas or townhouses to be able to enjoy their private garden or backyard.

“We got much more enquiries on the affordable villa areas. Mostly down Al Qudra road where we happen to be opening an office soon.”, says Emma. With AQUA Properties opening its new community office in Serena, this is a great opportunity for those looking for a townhouse to rent in Bella Casa Serena or Casa Dora as the community’s second phase.

Landlords Need To Adapt

When talking about the rental segment of real estate, this is surely a tenants’ market. “However, a lot of our tenants that were searching, have renewed with their landlords who have been realistic on the current situation and reduced rents so not to lose their tenants”, says Emma. Those not willing to adapt to new market prices and circumstances, have to face the fact that their properties in Dubai will stay empty for a while. Real estate is cyclical and at the moment rental prices have dropped. Savvy landlords are trying to attract tenants by giving special offers. “A lot of landlords are offering free-month stays or discounted rents to entice tenants.  They are even throwing in utilities in some cases”, explains Emma.

What Are Tenants Looking For?

Many residents whose tenancy contract was up for renewal in this period have used this opportunity to move to a better area or to reduce their rent. “Tenants nowadays want much more flexibility on the terms and conditions of their lease. They are asking for reduced break clauses for example or possibility to pay in multiple cheques”, says Emma. Rent paid in 12 cheques is no longer an exception in Dubai.

If you are looking for a villa or an apartment for rent in Dubai or if you wish to rent your Dubai property, feel free to contact us on +971 4 518 7555. Our dedicated real estate leasing consultants will be happy to assist you and find the best option for you.