Latest news with #SmartRentalIndex
Khaleej Times
18 hours ago
- Business
- Khaleej Times
How Dubai's Smart Rental Index helps residents negotiate unfair rent hikes
Tenants in Dubai are increasingly benefitting from the Smart Rental Index introduced as tenants are successfully challenging unfair and unjustified rent increases by the landlords. Therefore, rents in older buildings have started to correct downward six months after the introduction of Index as tenants successfully reverse landlord's decision to hike rents without a valid reason. 'Tenants are using the index it to stop unfair hikes — and successfully,' said Grace Jackson, leasing manager – Dubai, Huspy. 'A landlord proposed a 25 per cent increase for a tenant. Using the Smart Index, we found the legal increase was only 10 per cent based on similar buildings and the law. After showing this, the landlord agreed to reduce the hike. Another tenant in Dubai Marina challenged a 15 per cent rent jump. The Smart Index showed the market rent hadn't moved much for that building type. The landlord agreed to renew at the current rate,' said Grace. In January, the Dubai Land Department launched the Smart Rental Index 2025, which relies on an advanced building classification system that considers all technical and service-related aspects of properties. Each building is evaluated based on a comprehensive set of criteria, including technical and structural characteristics, the quality of finishes and maintenance, the building's strategic location and its spatial value, as well as the level of services and facilities available, such as maintenance, cleanliness, and parking management. ' The new index uses real-time data and building ratings to give more accurate rent estimates. In areas like Jumeirah Village Circle, for example, rents in older buildings have started to correct downward, while newer, well-maintained towers are maintaining or even increasing rent due to their higher building classification,' she added. Some landlords follow rules According to real estate consultancy Cavendish Maxwell, rental contract data from Q1 2025 showed a notable increase in the share of renewal agreements, likely driven by the introduction of the New Smart Rental Index, which aims to protect tenants from steep rent increases by regulating permissible rent adjustments based on comprehensive market data. Renewals accounted for 70.1 per cent of contracts in Q1 2025, up from 61.1 per cent in Q4 2024 and 62.2 per cent in Q1 2024. Grace Jackson added that most institutional landlords are following the rules set under the Smart Rental Index, but some private owners still try to push higher increases. 'However, tenants are now more informed. In Business Bay, one client was able to negotiate a better deal simply by showing the official index results. The landlord had no grounds to argue,' she added. Echoing other industry peers, she added that the Smart Rental Index has slowed down rent increases slightly. ' The index has made it harder for landlords to overprice units. It's brought more balance, especially in mid-range and older buildings.' A new era of accountability Grace pointed out that the introduction of the Smart Rental Index marks a new era of accountability. 'Agents now spend less time in subjective negotiations and more time educating both parties on what the data shows. In short, the Smart Index isn't just a tech update, it's a culture shift. And it's long overdue.' Overall, she added that this tool is making the Dubai rental market more balanced and data-driven, which benefits everyone by helping both sides make smarter decisions.
Khaleej Times
21-04-2025
- Business
- Khaleej Times
Dubai: Up to 20% drop in rents ‘healthy' for property market, says top developer
A 10-20 per cent drop in rents is healthy for the Dubai property market following a four-year rally, said a top developer. Rizwan Sajan, founder and chairman of Danube Properties, expects a correction in rents next year after a double-digit increase since the Covid-19 pandemic. 'Rental correction might come around 10-20 per cent next year, which is required and healthy because rentals have gone very high. A 10-20 per cent rental correction will help the market as investors are coming here what is happening around the world. Dubai benefits whenever there is uncertainty in the world. But at the same time, prices and rents should not go too high,' Sajan told Khaleej Times in an interview. As reported last week, some properties in Dubai have started to see a decline in rentals due to growing competition among landlords, the impact of the Smart Rental Index on older properties and the supply of new units pressuring rents down. But a wider drop in rents across more communities is expected to be felt next year. Danube Properties chief also attributes a strong pipeline of new supply which will hit the market next year for a drop in rents. According to Property Monitor, Dubai saw 7,848 units handed over in the first quarter of 2025. A total of 71,251 new units are likely to be delivered for the whole of 2025, 80,015 in 2026 and 58,766 in 2027. 'This substantial influx of new supply over the medium term will be a key factor to watch, alongside ongoing demand dynamics, as it may influence both property prices and rental rates,' said Betterhomes in its first quarter report released on Monday. 'We should see some correction in rentals next year when deliveries happen. Prices might also see some correction, but there is nothing to worry about for good developers who offer good quality and amenities,' Sajan said, adding that a lot of investors from the US and Canada are coming to UAE. 'Dubai always benefits whenever there is uncertainty globally,' he said. Shortage of quality contractors Danube Properties is among the top 10 developers in Dubai, delivering thousands of units so far. It delivered three projects ahead of schedule since the first half of 2024. The private developer has launched 34 projects, successfully delivered 18, with another 16 currently in various stages. Last week, it unveiled its latest residential project Sparklz by Danube, a 358-unit tower coming up in Al Furjan. Currently, Danube holds an impressive book value with construction spanning over 25.5 million square feet. Sajan said there is a shortage of quality contractors in Dubai as the emirate has seen a good influx of new foreign developers as well as local ones. 'Finding a good contractor is going to be very, very challenging. Selling properties will not be as big a challenge as finding a contractor because there are too many developers but the number of contractors is the same. Also, contractors like to work with only developers with good reputations because the property market is cyclical and this market has seen its share of ups and downs. And contractor could face a challenge if developer's reputation is good,' said Sajan 'There are not as many new contractors coming here as the number of developers. There is plenty of space for contractors to grow – more space for contractors than developers. More contractors from Oman, Bahrain, Saudi Arabia and India should come here because there is a lot of work here in Dubai and UAE,' he said. Danube's chief suggested that developers coming from other countries should bring in contractors as well to meet growing demand. For contractors, he noted, it is very easy to set up a company, hire workers, process visas for labourers and get approvals. 'Dubai is one of the easiest cities in the world to do business and work,' he added.
Hi Dubai
18-04-2025
- Business
- Hi Dubai
Dubai Rents Show Signs of Decline in Select Communities After Double-Digit Increases
Dubai's rental market is showing signs of stabilisation after years of sharp increases, driven by population growth and strong post-pandemic demand. While rents remain high in prime areas, the overall pace of increase has slowed, with some communities even seeing modest declines. Industry experts agree that the era of double-digit rent hikes is over. Lewis Allsopp, chairman of Allsopp & Allsopp, noted an 8% month-on-month decrease in average rental prices across apartments and villas. 'Apartment rentals alone dropped 9% year-on-year, signaling a shift toward a more balanced market,' he said. The launch of Dubai's Smart Rental Index, which promotes fair pricing, along with a steady stream of new residential handovers, is pushing landlords to rethink their strategies. Rupert Simmonds, director of leasing at Betterhomes, said villa communities like Nad Al Sheba and The Villa have seen rents fall 7–9% over the past year. 'Areas with high new supply, like Dubai Creek Harbour and MBR City, are likely to see further declines,' he added. Mid-tier communities such as Jumeirah Village Circle and Dubai Sports City are stabilising, while luxury areas like Palm Jumeirah and Downtown Dubai remain resilient due to limited availability and high demand from wealthy expats. Landlords are facing growing pressure as more tenants shift toward homeownership. The Dubai Land Department reported a 30% drop in rental renewals month-on-month. 'This competition is prompting landlords to be more flexible to avoid vacancies,' said Simmonds. Joshua Nairn from Huspy Real Estate summed it up: 'The market has matured. While we may see fluctuations in areas with new supply, a city-wide decline in rents is unlikely given Dubai's strong fundamentals.' News Source: Khaleej Times
Khaleej Times
18-04-2025
- Business
- Khaleej Times
Dubai: Are rents dropping in some communities after double-digit hikes?
Rents in some Dubai communities have declined. Overall, however, rents are increasing at a slower pace. Real estate industry executives say that the era of double-digit rent increases is behind us as the market has matured. It is now seeing much more stable and gradual growth in rentals. Rents and property prices have been rising after the pandemic due to strong demand from a growing population, which is rising at an almost double-digit rate. Lately, rents have been plateauing after the four-year rally and industry insiders say that they are dropping in some areas. These include locations where new supply has hit the market, and older buildings following the launch of the new Smart Rental Index. Lewis Allsopp, chairman at Allsopp & Allsopp, said there are signs that the emirate's rental market might be entering a period of adjustment. He said Allsopp & Allsopp's data showed an 8 per cent decrease in average rental prices across both apartments and villas/townhouses month-on-month. 'Specifically, apartment rentals have seen a 9 per cent year-on-year drop. These figures suggest a shift in the market's previous upward trend which could create a more balanced environment for both landlords and tenants.' Rents in Dubai are likely to adjust because of a few things. The new smart rental index is a major factor, pushing landlords to keep prices fair. More new buildings mean more rental options too. Plus, with more tenants considering buying homes, landlords need to be competitive. All of this is working to balance the rental market. 'Rents have already decreased from their peak in certain areas, with some achieving lower rents in 2025 compared to 2024. Villa communities like Nad Al Sheba and The Villa have seen a 7-9 per cent drop over the past 12 months,' said Rupert Simmonds, director of leasing at Betterhomes. He added that communities with a high level of new supply are likely to experience declines starting in 2025 into 2026. 'While some rents have plateaued or even declined, others are still increasing. Prime areas such as Palm Jumeirah, Downtown Dubai, and Dubai Hills Estate have remained stable or risen due to high demand and limited luxury properties. Meanwhile, mid-tier and affordable communities like Jumeirah Village Circle (JVC), Dubai Sports City, and Discovery Gardens show signs of stabilisation,' he said. According to Simmonds, luxury properties in prime areas such as Palm Jumeirah and Dubai Marina will likely be less affected due to limited availability and the influx of high-net-worth individuals (HNWI) and ultra-high-net-worth individuals (UHNWI) moving to Dubai. Growing competition among landlords Allsopp added that the trend of rising rents has pushed many tenants towards homeownership, with the Dubai Land Department reporting a 30 per cent month-on-month decrease in rental renewals. 'This is prompting landlords to reconsider rental pricing to attract new tenants. Additionally, the Smart Rental Index will likely put pressure on landlords of older buildings to lower rents if they don't meet current amenity and finishing standards,' he said. Rupert Simmonds noted that areas that are seeing a high volume of new unit handovers such as Dubai Creek Harbour, Mohammed Bin Rashid City, and Dubailand, could experience rent decreases. 'This is because increased competition among landlords will likely put downward pressure on rental prices. Landlords who are inflexible may face more vacancies, increasing downward pressure on prices. Landlords should be flexible on price to ensure maximum occupancy and minimum void periods because that is where a landlord makes the biggest loss,' added the director of leasing at Betterhomes. No more double-digit rental increase Joshua Nairn, leasing manager at Huspy Real Estate, believes the era of double-digit increases is behind us. He expects some fluctuations in communities experiencing mass handovers of new properties, as the increased supply could temporarily impact rents in those specific areas. However, overall, he doesn't foresee a decline across the city. 'The market has matured, and we are now seeing much more stable and gradual growth in rental prices,' he said, adding that he doesn't foresee rents decreasing in Dubai's major communities. 'With that being said, we may see fluctuations in specific areas or certain market segments, but I do not anticipate a widespread decline across the city. Given Dubai's strong market fundamentals — including population growth and economic stability — I don't expect significant declines in rent over the next couple of years, certainly not by 2025 or 2026,' he added. Nairn added that new residential units are being introduced to the market, helping to balance supply and demand, potentially slowing down the rate at which rental prices increase.
The National
27-03-2025
- Business
- The National
Abu Dhabi unveils verified property listing platform to boost trust and combat misleading adverts
Abu Dhabi on Thursday set out plans for the launch of a unified property listing tool to boost 'trust and transparency' in an evolving housing market and combat misleading advertisements in the latest step to keep pace with a real estate sector boom. The Abu Dhabi Real Estate Centre said the multiple listing portal – called Madhmoun – would offer brokers, developers and buyers a 'reliable and centralised' platform for property transactions. Madhmoun – which means verified in Arabic – will provide verified listings, offers real-time updates about properties and enables authentic advertising to ensure that all transactions are based on valid and reliable information. 'We are delighted to introduce Madhmoun, which we believe will transform how real estate transactions are conducted in Abu Dhabi,' said Rashed Al Omaira, acting director general of Adrec. 'This initiative reflects our commitment to bringing innovation, transparency, and efficiency to the real estate market. 'The launch of Madhmoun represents a significant step forward for Abu Dhabi, strengthening trust and transparency across the real estate market. As the first initiative of its kind in the region, Adrec is proud to lead this effort, further reinforcing Abu Dhabi's status as a resilient and globally competitive real estate investment hub. 'Madhmoun is not an advertising agent but an internationally recognised platform designed to empower aggregators, elevate market standards, and enable authentic advertising,' added Mr Al Omaira. Adrec said the launch of the platform was 'upcoming' but did give a specific date for its roll-out. Building up trust Every property listed on Madhmoun will be thoroughly verified to ensure accuracy and reliability, said officials. Users will have access to the latest property data, allowing for informed decision-making. Adrec said Madhmoun will 'eliminate misleading property advertisements, providing users with honest and transparent listings'. The authority said the initiative will increase the visibility of property listings by an average of 70 per cent and will contain the latest information on homes available in a given market or area. Supply and demand In August, Adrec unveiled the capital's first residential rental index, aimed at providing indicative rental values for both tenants and landlords across different areas of the capital. The Rental Index is available online at Adrec's website and highlights rents in different areas. Abu Dhabi's residential sale prices and rents rose last year amid higher demand and a supply shortage in the emirate, according to a report. Home sale prices increased by 11 per cent annually in 2024, while rents rose by 20 per cent, real estate company Cushman & Wakefield Core said in a report this month. Dubai has also taken steps to enhance transparency and stability in the property, with the emirate also witnessing a surge in demand as its population rises. The Dubai Land Department launched a Smart Rental Index on January 2 – including a star rating system for residential buildings. The system uses artificial technology to deliver property price updates at any time, unlike its predecessor, which was updated once a year. The old index was based on zones or districts, while the new one focuses on each building and covers all areas in Dubai including freehold and non-freehold areas.
