Realty Check: Dubai residential rents witness record increase since 2015

Asking residential rents in Dubai have leapfrogged and moved at the highest pace in five years, according to a new ValuStrat report.

Average annual rents stood at 78,181 UAE dirhams ($21,000) during the third quarter of 2021, up 6.9 percent compared to the same period last year, a record increase not seen since early 2015, the consultancy firm said.

On a quarterly basis, citywide rents were up 3.6 percent. The most notable increases, however, were reported in the villa segment of the market, which continued their rally upwards in the third quarter, rising by 14.1 percent, while apartment rents went up by just 2.6 percent compared to a year ago.

Studio apartments now cost around 36,000 per annum on average, while one-bed and two-bed flats are estimated to cost around 53,000 dirhams and 76,000 dirhams per year, respectively.

The residential market also recorded an occupancy rate of 81.3 percent in the third quarter, slightly up from 80.6 percent in October last year.

According to Haider Tuaima, head of real estate research at ValuStrat, the rents for villa properties are likely to continue rising until new supply changes the dynamics in the market. However, the trend is not the same for the apartment category.

“Villa