Tenant relocation is a matter of choice or necessity?
Many residents are priced out of prime areas due to growing demand and
ever-rising rental rates.
As commodities in so-called secondary locations, namely those along the
Sheikh Mohammed Bin Zayed road(E311) corridor,continue to evolve, residents are
taking advantage of lower rent rates and/or the opportunity to many tenants
being priced out of prime developments due to growing demand and ever – rising
rental rates.
Although existing tenants are protected by rental cap, which only allows
an increase if rents fall below the area range stipulated by RERA, not everyone
is aware of this, with some people forced out of their homes because landlords
claim to be moving in themselves, or selling the property when, in fact,
they’re simply looking for an opportunity to get higher rents from new tenants.
Again, many residents are oblivious to the fact that the owner has to
give 12 months notice before they can evict the tenant, or simply decide to
move out in order to avoid any hassle with the landlord.
Based on the RERA rental index,the prices for one-bedroom apartments in
Dubai Marina/ Jumeirah Beach Residence range from Dh50,000 up to Dh90,000.
According to listings on one of the most popular property search engines in the
UAE, there are over 1,300 units advertised above the upper limit of that rang.
Despite the fact that this number includes duplicate advertisements and
furnished units that achieve premium, the total figure and the fact that new
tenants are willing or have no choice but to pay the price or move to less
desirable areas is alarming.
Even though rising demand is a result of the growing economy and
consumer confidence, which is a positive indicator, if rates continue to grow
at these levels, it won’t be long befor people have no choice but to leave
Dubai for the more affordable neighboring emirate of Sharjah, at least for the
short term.
In the long run, however, there is still a significant amount of
supply
in the pipeline and this, coupled with new project launches, is likely to level
out the supply-demand balance and keep rent hikes at bay.
Property Tips
·
Some tenants are forced out of their homes not aware
of the rental cap.
·
Some are oblivious to the fact that landlords must
give 12 months notice.
·
People might leave Dubai for cheaper Sharjah if rates
continue to increase.
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