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Sharjah’s residential property market is starting to show signs of softening, although a report by real estate firm Cluttons notes that this is not holding back new communities that are emerging as the population and developments spread further north.
According to Cluttons’ Sharjah 2015/2016 Winter Property Market Snapshot, house rents stagnated and recorded a marginal 0.3 per cent increase in the third quarter, while year-on-year rents dropped 1.6 per cent. This is the first time in over two years that average annual residential lease rates have contracted, but demand still remains for high-quality stock and gated communities, according to the report.
Rising supply levels, price reductions in Dubai and new options in Ajman are undermining rents, according to Faisal Durrani, Head of Research at Cluttons. “However, well-managed buildings still have longer waiting lists than lower-quality buildings and continue to drive demand,” said Durrani. “At the same time we are seeing reduced waiting lists for what is perceived to be lower-quality stock.”
The report states that new communities and gated villas have continued to outperform the wider residential market, particularly apartments, with rents rising by 4.1 per cent during the first nine months of the year.
In the commercial market, office rents across the main submarkets registered no change during the third quarter, with prime areas of Al Majaz remaining the most expensive with rates reaching Dh75 per square foot.
Source: Property Weekly