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The outlook for the northern emirates real estate market this year is set to follow the general UAE trend, according to a report by real estate services company Asteco. The UAE Property Review 2014 Highlights and 2015 Outlook report said a muted year is on the cards in terms of market move ment following a 10 per cent average rental increase in Sharjah, Ajman and Ras Al Khaimah last year.
Asteco noted that Sharjah is likely to see a reduction in the number of people relocating from Dubai due to improved rental opportunities, increased supply and a decline in rental rates.
“Northern emirates real estate, particularly in Sharjah and Ajman, has traditionally been characterised by strong interdependence with Dubai due to overflow demand,” said John Stevens, Managing Director of Asteco. “That scenario peaked in the first quarter of last year and the current slowdown in Dubai has effectively put the brakes on tenant migration.”
Fujairah and Umm Al Quwain, however, are unlikely to see much change, as they are less affected by Dubai.
High growth and occupancy levels were recorded throughout the northern emirates in the first half of last year, but the second half saw downward pressure on leasing rates, which were already around 50 per cent cheaper than similar properties in Dubai. Some tenants relocated to cheaper places around the Dubai-Sharjah border as their landlords were unwilling to negotiate.
Source: Special to Property Weekly