Muscat: Average rents in Sharjah remain 38 per cent below rates from 2008, as additional supplies keeps rates from increasing rapidly, according to the UAE Property Review for the third quarter of 2016 published by leading real estate consultancy Asteco.
Further, the report revealed that the Northern Emirates property market remains stable. Sharjah apartment rents saw minimal changes in the third quarter, down by only 1 per cent, while RAK recorded a 1 per cent rise, compared to the previous quarter.Ajman also witnessed an increase of 1 per cent, bringingprices close to their 2008 peak levels, beingonly 9 per cent lower.
“The stabilisation of the market was a knock-on effect, in part, due to rental rates in Dubai also balancing out. As a result, there were a minimal number of relocations taking place between Dubai and the Northern Emirates,” said John Stevens, Managing Director of Asteco.
New developments in Sharjah attracting investors include Sahara Tower 6 by Al Thuriah, which was announced during Cityscape 2016. Construction of the residential twin tower has already started andwill provide 376 residential units, which are now on sale and due for handover in the fourth quarter of 2019.
On average, new developments in Sharjah range from AED20,000 to AED35,000 to purchase a studio, and AED45,000 to AED90,000 for a three bedroom unit. Rental rates in Al Majaz range from AED25,000 to AED35,000 for a studio,while three bedroom apartments are available from AED48,000 to AED90,000. Corniche prices start from AED26,000 to AED35,000 for a studio, while three bedroom apartments cost from AED60,000 to AED95,000.
Ras Al Khaimah was the star performer, albeit relatively, with a strong tourism and hospitality offering. “The Emirate currently has 3,600 hotel rooms, and its occupancy rate has risen to 71 per cent, with more than 40 per cent of the guests from the UAE. Furthermore, the RAK Free Zone, popular with many small and medium-sized businesses, has created both residential and office demand,” Stevens added.
Rental rates for newer buildings in RAK range from AED26,000 to AED40,000 for a studio and AED85,000 to 110,000 for a three-bedroom apartment.
The rise in Ajman rental rates was attributed to the addition of better quality supplies to its stock, while also improving its overall offering to residents, in terms of retail and road connectivity. High-end apartments in Ajman ranged from AED22,000 to AED38,000 for a studio, while three-bedroom apartments were available from AED42,000 to AED72,000.
Further, rental rates in Fujairah remained stable during the quarter due to the new supply, such as the Fujairah housing project in Al Taween, which is now 95 per cent completed, and is expected to be handed over before the end of 2016. Meanwhile, Fujairah’s cultural centre has reached 55 per cent completion, with handover of unitsexpected in the second quarter of 2017. Rental rates typically varied from AED23,000 to AED28,000 for a studio and AED45,000 to AED60,000 for a three bedroom unit.
Demand for office space in Sharjah remained stagnant over the quarter, with limited new supplies entering the city, leaving rates unchanged for the third quarter.
“The retail sector has started developing rapidly in Sharjah and Ajman, as population levels support such expansions. For instance, new food and beverage outlets opened this quarter at the Al Majaz Waterfront and the Corniche areas in Sharjah, whereas the expansion of Ajman City Centre mall to nearly double its current size, to 52,000 square metres, is anticipated to be completed by the end of the third quarter of 2017,” Stevens said.