Property News · February 15, 2016

Sharjah and Ajman property prices fall as Dubai developers offer cheaper homes



Sales of new homes in the Northern Emirates are likely to remain subdued in 2016 as a “bleak economic outlook will affect buyer’s sentiment,” according to a new report from Asteco Property Consultants. The Northern Emirates are typically interdependent with Dubai’s property market, and with both house prices and rents continuing to fall in Dubai with more developers offering more affordable homes, attracting buyers to Sharjah, Ajman and Ras Al Khaimah could prove to be more difficult in the future.
“Only quality projects at truly affordable prices may be able to generate some traction,” said John Stevens, the managing director of Asteco Property Consultants. Sale prices fell by 2 per cent in Sharjah, 5 per cent in Ajman and 1 per cent in Ras Al Khaimah in 2015, while rental rates dropped by 2 per cent in Sharjah and Ras Al Khaimah but stayed flat in Ajman. Mr Stevens said that in the past, there had been an “ebb and flow” of residents between Dubai and Sharjah based on rents – when they go up in Dubai, people move out to Sharjah and when they drop they move back.
Yet falling rents in Dubai and an unpredictable jobs market means that there isn’t the usual inflow of new tenants. Moreover, rents have not dropped by big enough percentages in Dubai to tempt settled Sharjah tenants to move.Mr Stevens said that infrastructure in Sharjah has also improved as a result of investments in road connectivity and new tourism attractions like Noor Island and the Majaz waterfront.
“With both emirates investing heavily in infrastructure development and a growing quality-focused residential offering, we are seeing a slow shift towards a more stable environment as investors and tenants consider the quality of life outside of Dubai,” he said.Average rents in Sharjah range from Dh38,000 per year for a one-bed apartment up to Dh58,000 for a three-bed. In Ras Al Khaimah, rents range from Dh38,000 for a one-bed up to Dh100,000 for three-bed villas on newer projects and in Ajman rents range from Dh43,000 for a one-bed up to Dh64,000 for a three-bed property.
New regulations were introduced in Sharjah in 2014 to allow non-GCC nationals to buy properties under a 100-year leasehold, but Asteco said that sales to date have been subdued – partly because ownership rules remain unclear but also because of the new wave of affordable property launches with accompanying payment plans in Dubai.However, the developer of the Dh2.4bn Tilal City project close to the Dubai border this week claimed that it had received “strong interest” from potential buyers in its project. Tilal City is being jointly developed by Sharjah Asset Management and Eskan Real Estate Development. It consists of 1,855 plots for apartments and villas. Although it would not reveal how many of the plots have been sold to date, it said that most of the interest had come from long-term Sharjah residents – both Arab and non-Arab in origin.
“The unique ownership opportunities are attracting both Arab and expat buyers from across the Middle East,” said Tilal Properties’ executive director of business development, Haysam Jazairi.mfahy@thenational.aeFollow The National’s Business section on Twitter

Source : thenational.ae
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