Residential rents in Sharjah are on the decline for the first time in over two years, although new developments have continued to perform well, according to Cluttons.
The real estate consultancy said third-quarter residential rents showed barely any movement, with a marginal 0.3% increase, while rents are 1.6% lower year-on-year.
“Rising supply levels across many areas of Sharjah, coupled with price reductions in Dubai offering a shorter commute, and increasing value for money in Ajman are starting to undermine rents,” said Faisal Durrani, head of research at Cluttons.
It is the first time in over two years that the average annual residential lease rates have contracted, even though demand remains high, especially for gated community property, Cluttons noted.
New communities and gated villas have continued to outperform the wider residential market, with rents up by 4.1% in the January to October period, it said.
“Well-managed buildings that are perceived to offer better quality and increased facilities still have longer waiting lists than lower quality buildings and continue to drive demand. At the same time we are seeing reduced waiting lists for what is perceived to be lower quality stock,” said Durrani.