Real Estate Prices Stagnant in UAE's Northern Emirates in Q-4

Real Estate Prices Stagnant in UAE's Northern Emirates in Q-4

Residential News » Residential Real Estate Edition | By Alma Kadragic | January 25, 2011 9:59 AM ET

(DUBAI, UAE) -- The Northern Emirates property market has stayed relatively stagnant during the last quarter of 2010 with minimal price or rental movements. Continued supply, most notably in Sharjah will at some stage put downward pressure on rental prices, but connection to electricity, water and sewerage is a problem, slowing the pace of supply throughout the Northern Emirates, according to data from Asteco Property Management.

"During the past three months, the Northern Emirates have remained at a standstill, with rental rates for apartments, villas, and offices similar to the previous quarter. Although new supply is expected to drop rates further, delays in the actual handover of units is likely to prolong the process," said Elaine Jones, CEO, Asteco Property Management.

Across the Northern Emirates apartment, villa and office markets have remained relatively flat over the past three months. The ripple effect of affordability predominant in Q3 2010, which saw tenant migration to neighbouring emirates such as Dubai continued in Q4 but more slowly, consistent with the slowing rate of decline in Dubai.

The Asteco Northern Emirates Q4 2010 report reveals that three-bedroom apartments in Sharjah are priced in a range from $10,218 per year in Al Yarmouk to $12,670 in areas such as Al Khan and Al Nahdah. Umm Al Quwain, meanwhile, is still the most affordable emirate with average annual rates of $6,811.

The Sharjah villa market did not record any price changes from Q3 to Q4 with Al Quz, therefore, remaining the most expensive residential area for villas at $22,480 a year for three-bedroom properties. Elsewhere, Al Khan, and Shargan commanded $21,798 and $20,436 respectively for three-bedroom villas.

"A number of residents living in the Northern Emirates have moved around internally, seeking value for money and better located units; however, there has been no evidence of an increase in population to occupy the vacant units," says the report.

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