Dubai Real Estate Market Could Spell Good News For Rental Negotiations.

Tenants in Dubai could soon receive some long overdue good news with regards to renting Dubai real estate. For a good while now rental prices in Dubai have been continuously increasing, in some cases to levels so high that many have had to consider the feasibility of staying in Dubai. With many tenants having to spend upwards of 50% of their salaries just on rent, renting here in Dubai was become a large burden. Even now the situation for tenants in not clear and highly confusing. The Government is yet to release the rental cap for New Year whilst the long awaited rental index is also yet to materialize. Add in there are conflicting reports of price increases and decreases and you do have to wonder what is going on! But the luck for tenants might just be about the switch if they are looking at renting Dubai properties.

After years of landlords having the upper hand, and tenants often having to accept large rent increases, the balance of power may just be starting to swing back in favor of tenants. The effects of the current economic crisis have seen many people looking to downsize to more affordable property which has had a large effect on the demand for high end apartment rentals. Then factor in the recent job losses that have been seen in some sectors of Dubai’s work force and the increased number of properties available as a result. Then there is the fact that New Year is traditionally the time when developers release a large amount of their property onto the market. There will therefore be a flood of available properties onto the market at a time period when demand looks to be greatly diminished. Tenants should therefore have a much larger say in the number of installments by which they pay their rent, and should even be able to negotiate a price reduction!

Some agents are predicting a rental price correction in the region of 30% in the first quarter of the year, with high end rental properties seeing the largest drop. A lot will depend on the Governments announcement with regards to the rental cap, and it still remains to be seen if the lack of liquidity with which to purchase property drives a lot of people into the rental market, but overall tenants can remain optimistic.
 

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