New residential towers in Sharjah are not staying vacant for long.
The take-up rates are running faster than before as landlords perk up their properties with 'improved quality, car parking availability and better location', according to the consultancy Asteco. And demand for new properties is starting to tell ever so slightly on the older - and less well-kept - units.
There were rental declines for Sharjah and Ras Al Khaimah - each by 2 per cent - last year, Asteco reports, whereas Ajman was unchanged.
"Market activity in Sharjah is historically interlinked with that of Dubai, with the two emirates in such close proximity that the ebb and flow of residents between them usually follows the rental market highs and lows in Dubai," said John Stevens, Managing Director, Asteco. "But 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."
And that quality of life comes at a price - in Sharjah's Majaz and Al Khan neighbourhoods, an upscale three-bedroom apartment could achieve Dh95,000 and Dh105,000 as rent in comparison with the average of Dh85,000 just months ago.
Sharjah continues to draw in attention even from investors. The Sahara Tower 4 by Al Thuriah in Al Nahda was selling two-bedroom apartments from Dh765,000 and with 50 per cent of payment due after completion. A two-bedroom at the Al Rayyan complex was also coming under the Dh1 million mark.
"The sales sector witnessed increased levels of interest from investors, although transaction levels were relatively subdued due to concerns of market stability and competition from Dubai where substantial amounts of affordable supply were launched," Asteco reports.
As for rental demand in Sharjah through the rest of the year, Asteco reckons that demand could be "stagnant" as "a reduction in prices in Dubai will lead to a lower than usual inflow of new residents, which may be worsened by reduced government spending and potential job cuts."
More than 1,000 units could be added to the residential market this year, in the form of the CG Mall Residences, Al Rayyan Complex and buildings in Al Nahda and Al Khan areas. This could mean the "overall market and specifically poorer quality developments could face a downward rental pressure."
Even home sales could come under pressure across the northern emirates, "as a bleak economic outlook will affect buyer's sentiment. Only quality projects at truly affordable prices may be able to generate some traction and if proper property ownership laws and regulations are in place."
New properties in northern emirates are drawing a lot of attention
? Ajman saw "significant improvements as the Al Zorah development progressed, where the golf course is now operational and the Oberoi Hotel is set to open by the middle of 2016", according to Asteco.
? In Ras Al Khaimah, major handovers in 2016 will include the Pacific Beachfront development by Select Group on Marjan Island, which features 1,440 apartments. Around 80 per cent of the units have been sold out. The Flamingo Villas Phase 2 at Mina Al Arab, made up of 68 units ranging between 2,008 to 2,334 square feet, is also expected to see handover by the end of the year.
Get a glimpse on Sharjah realty show which pulls in the big names
Source: Manoj Nair, Associate Editor, gulfnews.com