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Dubai rent market stability in second half of 2009

Dubai rent market stability in second half of 2009 - real estate - Property - Price - UAE - Sherwoods - Dubai

Sherwoods Independent Property Consultants has announced that it has recently deployed new strategic initiatives to capitalise on an expected upswing in real estate business activities within the last two quarters of 2009, as the global financial downturn gives way to more positive changes in Dubai's property rental market.

Furthermore, Sherwoods revealed that it expects the rental index introduced recently by the Real Estate Regulatory Authority (RERA) to further consolidate and stabilise the rental market in the long term, as it creates a highly transparent system that promotes investor confidence and helps control rates from once again escalating to unreasonable levels.

With rents becoming more affordable partly as a result of the global financial downturn, Sherwoods pointed out that the situation will ultimately deliver long-term benefits to Dubai's property sector as businesses will feel less pressure in subsidising housing allowances for their workers, while more people will be encouraged to relocate in the emirate. Sherwoods further noted that a more stabilised rental market combined with the adoption of a credible rental index system will likewise drive investor confidence as rental yields will be much more predictable and easier to calculate.

"Two key issues will impact Dubai's rental rates: employment and the supply of property in the market. Further job losses could erode demand, while the supply of inventory into the market needs to be controlled to avoid oversupply issues. However, as affordable accommodation remains a key driver to the Dubai economy, we have seen a positive trend in terms of proactive government intervention and the rent market's resiliency, which we believe will eventually help rents to level off and stabilise during the last two quarters of 2009," said Iseeb Rehman, Managing Director, Sherwoods Independent Property Consultants.

"The sharp acceleration of rents over the last couple of years has put enormous pressure on employers who were subsidising housing allowances, negatively impacting the growth of a number of business establishments. With the emerging trend of more affordable rents, the long-term prospects become a lot more encouraging as it helps encourage both businesses and people to relocate here. Accordingly, Sherwoods has devised new strategies to help clients identify and take advantage of the gainful opportunities that have evolved in this transition period in Dubai's rental market," added Rehman.


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