2009 rental index prices revealed

source Arabian Business

Real estate experts warned on Tuesday that thousands of tenants across Dubai could still face steep rental price rises – despite a decree issued by Dubai’s ruler.

Sheikh Mohammed bin Rashid Al Maktoum on Monday issued a directive freezing rents on residential and commercial properties in the emirate in 2009, for tenants who renewed their contracts last year.

However, if rents are more than 25 percent below the guideline figure recommended in Dubai’s new rental index , then the freeze does not apply.

Related: Dubai ruler issues decree to freeze rents in 2009
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This means many expatriates who arrived in the emirate before rampant inflation took hold, face paying substantially more to renew their leases this year.

Andrew Chambers, managing director of real estate consultant Asteco told Arabian Business: “There will be quite a lot of people potentially [who will see their rent rise in 2009].”

“Those people could have been in there two, three, four, five years and historically they’ve kept it down so that they would be in line for increases. If they [rents] are disproportionately low then why not?” he added.

But Dubai's new rental index has been attacked by agents for not being representative, and failing to take account of the quality, location and age of a building.

Peter Penhall, CEO of GoWealthy.com, an online property website, said: "I broadly support the logic but there are many holes in it. It's not representative. You've got an average benchmark rental rate for areas in Dubai where there older properties as well as new ones."

Other agents said the rental index will damage sentiment in an already rapidly cooling market at a time when landlords should be free to charge rents according to the quality of the building.

Laura Adams, leasing manager at broker Better Home's head office said: "The prices for rents are way down on what landlords were getting last year. The market should speak for itself. The prices are out of date and are too simplistic."

Tim Boswell, managing director of broker Ocean View, said the index was largely 'irrelevant' given the strong market feeling that rents would fall in the coming months.

The news comes just days after Dubai's Real Estate Regulatory Authority (Rera) revealed it had finalised the rental index that it hopes will replace the need for rent caps in the future.

Rera recommends that a one bedroom apartment in the Greens should cost between 110,000-130,000 dirhams ($30,000-$35,400) a year, against 110,000-150,000 dirhams ($30,000-$40,000) in the Marina.

The price of renting a one bed flat in International City, according to the index, is 65,000-75,000 dirhams a year, whereas the same property in Jumeirah Beach Residence (JBR) is placed at 110,000-150,000 dirhams a year.

Rera suggests a five bedroom villa on the exclusive Palm Jumeirah island should be leased at between 500,000-700,000 dirhams a year. A smaller villa with two bedrooms in the Springs will cost 190,000-230,000 dirhams a year.

The rental value of residential villas - Per Thousands
# Areas Two B/R Three B/R Four B/R Five B/R Six B/R
1 Dubai Tower / Downtown ..... ..... ..... ..... .....
2 Greens ..... ..... ..... ..... .....
3 Dubai Marina ..... 300-320 ..... ..... .....
4 International City ..... ..... ..... ..... .....
5 Green Community ..... 270-280 350-400 390-400 440-460
6 Jumeirah Beach Residence ..... ..... ..... ..... .....
7 Palm Jumeirah ..... 350-400 400-500 500-700 .....
8 Jumeirah Lakes Towers ..... ..... ..... ..... .....
9 Arabian Ranches 190-200 250-280 320-350 380-400 400-430
10 Jumeirah Islands ..... ..... 400-500 500-550 .....
11 Meadows ..... 300-320 330-400 420-500 .....
12 Springs 190-230 250-280 300-350 ..... .....
13 Gardens ..... ..... ..... ..... .....
14 Discovery Gardens ..... ..... ..... ..... .....
15 Dubai Investment Park ..... ..... ..... ..... .....
16 Dubai International Financial Centre ..... ..... ..... ..... .....
17 Dubai Silicon Oasis ..... ..... ..... ..... .....
18 Al Garhoud ..... 200-240 220-280 280-320 .....
19 Al Muteena ..... 130-150 150-180 250-270 .....
20 Hor Al Anz ..... 120-140 160-200 220-260 .....
21 Abu Hail ..... 130-150 140-170 170-200 .....
22 Al Wahaida ..... 130-150 140-170 170-200 .....
23 Al Tawar ..... 160-180 170-200 200-240 .....
24 Al Rashidiya ..... 150-170 160-190 190-230 .....
25 Nad Al Hamar ..... 160-190 220-240 290-320 .....
26 Al Warga ..... 150-180 210-230 280-310 .....
27 Mirdif (Complexes) ..... 150-180 190-200 220-250 .....
28 Mirdif (Individuals) ..... 170-200 230-250 300-320 .....
29 Al Mezhar ..... 150-180 210-230 280-310 .....
30 Al Khawaneej ..... 150-180 210-230 280-310 .....
31 Al Muhaisna First ..... 150-180 210-230 280-310 .....
32 Al Qusais ..... 120-140 150-180 200-220 .....
33 Nad Shamma ..... 150-170 160-190 190-230 .....
34 Al Jafeliah 100-130 120-150 140-170 160-200 .....
35 Al Mankhool 105-135 125-250 220-350 300-450 .....
36 Al Hudaiba 110-140 130-160 150-180 170-210 .....
37 Al Quoz Industrial 150-180 170-210 200-250 240-290 .....
38 Al Badaa 150-200 170-220 210-260 250-290 .....
39 Al Wasl 160-210 180-240 220-280 250-300 .....
40 Al Safa 170-220 190-250 230-320 260-400 .....
41 Al Manara 170-220 190-250 230-320 260-400 .....
42 Umm Al Sheif 170-220 190-250 230-320 260-400 .....
43 Al Barsha Residential 150-200 220-270 250-300 300-400 .....
44 Jumeirah 240-290 250-280 340-410 380-450 .....
45 Umm Suqeim 250-300 290-360 350-420 400-470 .....
he rental value of residential apartments - Per Thousands
# Areas Studio One B/R Two B/R Three B/R Four B/R
1 Dubai Tower / Downtown 110-118 125-165 150-260 280-320 330-350
2 Greens 80-90 110-130 168-180 200-260 280-320
3 Dubai Marina 80-90 110-150 150-180 220-300 280-400
4 International City 45-55 65-75 85-90 ..... .....
5 Green Community 80-90 100-120 140-150 240-260 .....
6 Jumeirah Beach Residence 80-90 110-150 150-180 220-300 280-400
7 Palm Jumeirah ..... 140-210 210-240 270-320 .....
8 Jumeirah Lakes Towers 75-95 120-135 170-220 240-350 380-400
9 Arabian Ranches ..... ..... ..... ..... .....
10 Jumeirah Islands ..... ..... ..... ..... .....
11 Meadows ..... ..... ..... ..... .....
12 Springs ..... ..... ..... ..... .....
13 Gardens ..... 90-95 100-115 130-140 .....
14 Discovery Gardens 70-75 95-105 130-145 ..... .....
15 Dubai Investment Park 70-80 90-95 130-135 200-240 .....
16 Dubai International Financial Centre 130-150 170-190 230-280 280-320 .....
17 Dubai Silicon Oasis 55-70 95-125 130-140 150-170 .....
18 Al Murar 40-50 55-65 65-75 ..... .....
19 Ayal Nasir 40-50 60-70 70-80 ..... .....
20 Al Daghaya 40-50 60-70 70-80 ..... .....
21 Al Ras 40-55 65-75 75-85 80-85 .....
22 Al Buteen 60-70 85-95 120-140 ..... .....
23 Naif 40-50 60-70 70-80 ..... .....
24 Al Baraha 40-50 55-65 65-75 ..... .....
25 Al Muhaisna Fourth 35-45 55-65 70-75 85-90 .....
26 Al Warqaa (Buildings) .... 65-75 85-95 140-150 .....
27 Al Nahdah 45-47 65-75 85-95 100-120 .....
28 Hor Al Anz 45-50 65-70 80-90 100-120 .....
29 Al Qusais 45-50 75-80 100-110 120-135 .....
30 Hor Al Anz East 55-65 80-90 100-120 140-160 .....
31 Abu Hail 45-50 65-75 80-90 100-120 .....
32 Al Muteena 55-65 65-75 100-120 120-150 .....
33 Al Muraqqabat 60-70 85-100 140-150 160-180 .....
34 Al Riqqa 60-70 85-100 140-150 160-180 .....
35 Rigga Al Buteen 60-70 90-100 110-120 140-150 .....
36 Mirdif 60-70 80-90 120-130 ..... .....
37 Al Garhoud 65-70 90-95 125-135 ..... .....
38 Port Saeed 55-65 80-85 100-110 ..... .....
39 Al Sabka 40-50 60-70 70-80 ..... .....
40 Al Souq Al Kabeer 45-60 75-80 85-95 125-135 ....
41 Al Huamriya 45-65 75-110 90-150 150-200 200-250
42 Al Jafeliah 45-40 55-65 75-130 110-170 ....
43 Al Badaa 45-50 60-90 75-110 .... ....
44 Satwa 45-50 60-90 75-110 .... ....
45 Al Hudaiba 50-60 65-85 90-150 130-180 170-220
46 Al Mankhool 60-85 90-120 115-170 150-200 170-220
47 Umm Hurair 60-80 80-120 110-160 150-200 ....
48 Al Karama 50-60 70-110 100-150 120-180 170-200
49 Oud Metha 70-80 95-120 120-150 155-180 ....
50 Trade Center 2 85-90 125-145 150-180 200-210 ....
51 Trade Center 1 85-90 124-145 150-180 200-210 ....
52 Al Barsha 60-85 80-120 100-160 130-170 ....
53 Al Refaa 50-60 65-85 90-150 130-180 170-220
54 Al Musalla 45-60 75-80 85-95 125-135 ....