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Residential property rents in certain areas may increase by about 10% to 15%.
During the upcoming Expo 2020, residential property rents in Dubai’s prime locations and waterfront areas may increase by about 10-15%, because during these six months, millions of people from abroad and within the UAE will flood in Dubai.
Analysts and executives in the real estate industry said rents in prime locations with limited supply, such as the city center, urban pedestrian streets, and Blue Water Island, will increase. Because these places will also witness many unprecedented entertainment activities during the Expo. In addition, due to the high occupancy rate of large-scale events, the surrounding areas of the Expo, such as Dubai South, Dubai Investment Park and Jumeirah Golf Estate, may also have rents rising.
In addition, the 2020 Dubai World Expo will attract millions of visitors from October 2021 to April 2022 and showcase the UAE on the global stage while creating thousands of direct and indirect jobs.
“We expect that there will be a large influx of jobs in Dubai during this period, especially in the fields of tourism, tourism, events and exhibitions, technology, marketing and logistics. In addition, we expect that some of these international tourists will be provided by the emirate’s business , Employment and social positioning, and hope to live/relocate to Dubai, which will translate into an increase in rental demand in the short term,” said Prathyusha Gurrapu, head of research and consulting at real estate consulting firm Core.
She added that mature villa communities with limited stocks and gold and seaside apartment districts are expected to see higher rent elasticity.
In the 12 months to June 2021, the average rent in Dubai fell by 7.6%, mainly due to the weakening of apartment rents, which fell by 9.6%, while villa rents increased by 7.2% in the same period.
“Although Expo 2020 will directly promote the recovery of residential rents, there are a series of factors that affect the market together, such as the resilience of the UAE in fighting the pandemic, successful vaccine launches, positioning Dubai as a safe and open commercial destination, and domestic For job creation and financial incentives,” Gurrapu added.
Firas Al Msaddi, CEO of Fam Properties, predicts that rents in prime locations with limited supply will rise by 10% to 15%, and the same rules may apply to areas around the Expo site.
“The overall market will be better, but Dubai’s prime locations with landmarks will receive the highest attention, not the Expo area itself. So I want to say that places like Bluewaters, Downtown, Burj Khalifa, City Walk and Dubai Marina will definitely have a lot of activities. .
Al Msaddi said: “During the 6th month, there may be two months before the event and two months after the event. The city will host a series of events, which means that the demand for rent will be higher.”
Temur Khan, head of research for the Middle East of CBRE, said that the upcoming supply is mainly concentrated in the apartment part of the market. Given that this is the largest proportion of the existing supply, overall, the market is unlikely to increase in the city in the near future. Future rental rates.
“That said, there are many areas where rents have risen. Given the micro-market drivers in these areas, this trend is likely to continue. This trend will be largely driven by residents’ demand factors, rather than 2020. At the World Expo, the demand for accommodation will be concentrated in the hotel industry instead of the residential industry,” he said.
As the 2020 World Expo aims to showcase Dubai’s many advantages in life, work and entertainment, and as companies and individuals begin to take advantage of these advantages, the long-term demand generated by the World Expo can provide support for the residential market, especially the rental market, and sum up the sweat.
Wahid Abbas
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