As forecasts predicted, during the first quarter of 2013, both rental and sale prices in Dubai advanced to higher levels. Although property prices are still lower than those seen during the real estate market boom of a few years ago, they still continue to rise. Nevertheless, there are always exceptions. One area in Dubai registered a small decrease – the Dubai Marina.
Even though Dubai Marina is among the most attractive communities in the emirate, rental prices there have witnessed a fall since the beginning of the second quarter. It is estimated that rentals in Dubai Marina have decreased with about 0.7% compared to the last quarter of 2012.
Without a doubt, this new tendency surprised both investors and tenants. Dubai Marina is famous for the fact that it was among the first areas in Dubai that become very popular among expats. The demand for apartments in the area for rent and sale was great until the supply became plentiful.
So what are the reasons behind this unexpected price fall? One possible explanation is the low rental prices in areas, such as Discovery Gardens for example, which are in close proximity to Dubai Marina. A good number of these housing communities offer similar option of accommodation for more affordable price compared to Dubai’s Marina community. Consequently, many tenants are now choosing to rent in these residential communities.
Another cause for the drop in the property rents in Dubai Marina is the increased traffic levels in the area. The towers are too tall, with too many apartments, while the streets are too narrow, with not enough lines in each direction. The rising number of tourists and hotel apartments in the area also contribute to more traffics jams. Dubai Marina’s living conditions look less attractive nowadays.
In addition, more and more tenants tend to buy property in the community instead of simply renting there. That partly explains the minor rise in sale prices in Dubai Marina, which was registered during the first three months of 2013.
Still the rents’ fall is expected to be only temporary, according to real estate agents. Many tenants and investors still see Dubai Marina as a really attractive residential area. Even now, the area continues to enjoy one of the most impressive demand rates in Dubai, although slightly lower than in 2012.
Rental price falls in Dubai are still rare. However, the Dubai Chronicle reported a slight decrease in rental prices in the Downtown Dubai. During the summer months, decrease in rental prices is expected to occur in other parts of the city too.