|By Arabian Post Staff| A leading player in the Dubai real estate market has predicted a correction in the rental market at a rate faster than expected in 2016 as thousands of new apartments and villas enter the new supplies.
Real estate consultancy JLL predicted that average housing rents in the city would continue to fall by as much as 10 per cent over the coming 12 months. Asteco estimates that 12,000 apartments and 2,000 villas will be completed this year.
According to Hafeez Abdullah, Chairman of The H Holding Enterprise, the decline in rent prices could raise the emirate’s competitiveness over other regional and global markets, and might encourage more people to benefit from this most significant drop since 2011.
Earlier in 2015, Moody’s Investors Service stated that the slowdown in Dubai’s real estate market is positive in the long run, as it gives the market time to absorb the existing supply pipeline.
“Estimates show that in 2014, over 140 nationalities invested AED 218 billion in the emirate’s real estate market. We saw new investments methods facilitated to encourage more investors to come. For example, Dubai has allocated over 100 hectares of land for affordable housing, mostly to meet the demand for dwellings for people earning between AED 3,000 and AED 10,000 per month. These efforts will pay off gradually,” said Abdullah.
The market in Dubai is also influenced by the purchasing power of foreign investors and expatriates, economic slowdown of oil-exporting nations and the strengthening of the dollar-pegged UAE dirham against the euro and rouble.
