By Seban Scaria | The 971 Report (Yahoo News)
Residential rents in Dubai increased by 17% over the past 12 months, local daily Gulf News reported citing a research by real estate consultancy CBRE.
A growing population in the emirate and a limited supply in the most popular locations are the reasons behind the rise in rents, the report said.
“For tenants, this is a warning flag. We don’t want to see the market overheat as has done previously,” the daily quoted Matthew Green, CBRE’s head of research as saying.
According to the report, 36,000 new apartments and villas may enter the market during 2013 and 2015 if construction delays are minimal. Most of the residential supply is expected in locations such as Dubailand, Motor City, Dubai Sports City, Liwan and Dubailand Residences.
Residential sales rates rose 13% in the most established locations in the past one year with less than 20% funded by mortgages and the rest in cash transactions, Green said.
“There is some concern about speculation in the market, not like 2008, but we will keep an eye on it,” he added.
RETAIL SPACE
The overall retail supply in Dubai will increase to 2.45 million square metres by the end of 2015 from 2.2 million square metres when about 230,000 square metres of new retail space will be completed in the next three years, the CBRE report said.
Currently, Dubai has 57% of the UAE’s total retail stock of 3.85 million square metres, it stated.
According to the CBRE report, prime rental rates for new leases are now around AED4,500 ($1,225) per square metre. Mall rentals are slowly rising and the major malls have an occupancy rate above 90%.
Mall of Emirates and Deira City Centre are currently the most occupied malls, the report said.
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