Real estate values and rental returns in the northern emirates of Sharjah and Ajman have fallen in the last year, according to new market data.
Sale prices per square foot dropped 7% year-on-year in Sharjah and Ajman while rental prices for one-bedroom apartments fell 3.95% in Sharjah and 1.85% in Ajman, according to a report from classifieds platform, dubizzle Middle East.
The inland Ajman district of Al Helio saw the steepest decline of 21% while values in Al Nahkil dropped 10%.
Ann Boothello, Senior Property Marketing Manager at dubizzle, says, “This shows a leveling off of prices in Ajman, similar to its neighboring emirates. As housing has become more affordable, people are moving out of C or D grade rental properties (older properties) and upgrading to better spaces for the same budget.”
Sales price per square foot in Sharjah decreased overall by 7% from the same period the previous year, but values in Al Qasba dropped 39% compared to Quarter 1, 2015.
Rental prices for one-bedroom apartments in Al Qasba dropped from AED46,000 to AED40,000 and Al Nahda from AED40,000 to AED38,000, whereas three-bedroom apartments in Al Nahda remained the same.
The report from dubizzle – the UAE’s leading property classifieds platform – is its first ever property report for the UAE’s Northern Emirates. It suggests the health of Dubai’s real estate market has a ripple effect on the property market in the northern emirates, predominately Sharjah and Ajman due to their close proximity.
Sharjah, a growing, affordable option for professionals working in Dubai, saw real estate transactions in Sharjah grow 44.6% in 2015 – worth AED 25.5 billion – and the Emirate saw an 42% increase in evaluation enquiries, according to the Real Estate Registration Directorate of Sharjah.
The Sharjah Investment and Development Authority, Shurooq, recently revealed that Sharjah’s real estate sector had successfully developed approximately 84.5 million square metres in land from 2014-15, leading to the establishment of over 60 real-estate projects, this contributing to the leveling softening of property prices in the Emirate.
The dubizzle report reveals that property rental prices in Sharjah’s coastal areas -including Al Mamzar, Al Majaz and Al Qasba – have significantly decreased compared to Quarter 1 2015, with a drop in prices per square foot by 7%, 7% and 13% respectively. Similarly, Al Qasba witnessed a 39% decrease in sale prices per square foot.
Ann Boothello, says, “Although dubizzle ‘s data showed a significant decline in prices in certain districts in Sharjah, and Ajman, the overall decline is mild as these Northern Emirates still remain a viable option for UAE property seekers and offer more economical options than its neighbour Dubai for those UAE residents on smaller income brackets. As the UAE’s leading property portal, we are able to draw out trends in the market, helping residents make better decisions on whether to buy or rent and which community and city would suit their budget.”
Despite increases spotted in several districts, Ajman remains the most affordable emirate for property rental prices, says the report.
The Al Butain community in Ajman experienced a 43% decrease in sale price per square foot and a 19% fall in rental prices per square foot while, in other areas such as Al Rashidiya, rental prices remained stable.
Although Ajman’s Al Nakhil area witnessed an increase in rental prices across the board by 10% and 3% for one-bedroom and two-bedroom apartments respectively, there was an increase of 8% for one-bedroom apartments and 21% for two-bedroom apartments rental prices in Al Hamriya.
“Although rental prices increased by 10% in Al Nakhil, Ajman, the area is still more of an economical option than others, priced at AED 33,000 annually for a one-bedroom apartment. The increase in rental prices could indicate that, although prices are dropping across the emirates, there’s no doubt Ajman housing is considered the most affordable; there are those who will not opt to upgrade their home at a time like this, and will instead grab the best deal to increase their long-term savings and live more comfortably, whether they are Ajman residents or from neighbouring cities, Sharjah or Dubai,” says Ann Boothello.
“With the highest price for a one-bedroom apartment rental in Ajman priced at an average of AED39,000 and AED41,000 in Sharjah, these prices are non-existent in Dubai and are a significantly lighter blow to the wallet at 33% cheaper than a one-bedroom apartment in one of the more affordable districts in Dubai, International City and 200% cheaper than a one-bedroom apartment in prime district Downtown Dubai. The affordable rental prices in both Sharjah and Ajman indicates promising investment opportunities in the Northern Emirates should the legal framework be clearly defined to boost investor confidence.”
In 2015, dubizzle was listed in the top five most searched UAE brands and ranked as the eight most visited website in the UAE, with more than 5million unique visitors per month.
Last year, dubizzle reached almost 60% of the Internet population in the UAE, who visited four times a month for an average time of 16.5minutes per visit, with 60,000 new adverts posted live every day.
The image of Sharjah is taken by Sources…..and is reproduced from Wikipedia under the CreativeCommons licence.