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Occupancy levels rise in affordable districts
More than 60,000 people have already moved into International City,
while about 20,000 residents are living in Discovery Gardens, according
to Nakheel.
"International City remains one of Dubai's most
popular rental communities. Its affordability combined with its
location makes it an attractive destination for local and international
businesses, retailers, commercial establishments, traders and
residents," a Nakheel spokesperson told Emirates Business.
According
to the master developer, International City is made up of 387
buildings, while Discovery Gardens has 245 buildings with the majority
being owned by third parties.
Real estate agents said
occupancy levels in Discovery Gardens and International City is
currently around 60 per cent, up 15 per cent in the past six months.
"Real
estate prices and rental prices in these two areas have dropped
tremendously attracting many new occupants into the development," said
Mohanad Alwadiya, Director, Harbor Real Estate.
However, the profile of people residing in Discovery Gardens and International City are more of tenants than owner occupants.
"Both
these developments were sold off largely to investors than end-users,
hence there are more tenants living in these developments than owner
occupants," he said.
Last month, real estate analysts told this
newspaper that prices of apartments in master developments such as
Dubai Silicon Oasis, International City and Discovery Gardens had
stabilised in the past three months, making them the most affordable
developments for middle-income earners.
According to agents, the
current prices in International City for a studio, one- and two-bedroom
apartments were in the range of Dh275,000, Dh450,000 and Dh550,000
respectively, declining five per cent since the past quarter.
Besides,
agents believe Nakheel's recent move to drop service charges in
Discovery Gardens will attract buyers into the development. Last month,
Nakheel dropped service charges on Discovery Gardens by Dh5 per square
foot in line with Dubai's Real Estate Regulatory Agency.
According
to Harbor Real Estate, current rents for one-bedroom apartments in
International Media Production Zone (IMPZ) is about Dh50,000 per annum
(payable across four cheques). In Discovery Gardens, the rents are
Dh60,000 per annum (eight cheques), while rents in International City
are at Dh50,000 per annum (payable across four cheques).
A
two-bedroom apartment in IMPZ is currently rented for Dh70,000 per
annum in four cheques. In Discovery Gardens, current rental are
Dh80,000 per annum in four cheques while in International City, current
annual rents is Dh75,000 in four cheques.
According to Asteco,
a studio in Discovery Gardens and International City is being rented
for Dh40,000 and Dh38,000. A one-bedroom apartment in Discovery
Gardens, International City and IMPZ are Dh60,000, Dh55,000 and
Dh45,000 respectively. A two-bedroom apartment is being rented for
Dh85,000 per annum, Dh70,000 per annum and Dh60,000 per annum,
respectively, in the same areas.
According to Colliers
International, a two-bedroom apartment in IMPZ is being rented for
Dh68,000 and Dh70,000 in International City. In Discovery Gardens,
rents for a two-bedroom apartment is about Dh75,000 per annum.
When
asked if rents were higher in freehold areas compared to non-freehold
areas, Camilla Van Der Merwe, Head of Leasing, Dubai, Asteco Property
Management, said: "There is not much of a difference between rental
rates on freehold and non-freehold properties. Location, access,
facilities, good property management and proximity to amenities
determine how successful rental rates are for a particular area."
She
said owners who have purchased for investment and leased their property
are looking to retain their tenants by negotiating and reducing rents
as per the current market rates.
"It is difficult to assess
which areas are better and it really depends on individual preferences.
Some people prefer to remain in the old areas because they have been
living there for a long time and they are paying low rentals.
"All
depends on which areas people work. Somebody working in Bur Dubai or
Deira may not consider Discovery Gardens to live since it is farther
out and commuting to and from work would be an issue even though rents
are low there," said Der Merwe.
Kosta Giannopoulos, Manager,
Residential Sales and Leasing, Better Homes, said in terms of rentals,
one can find similar priced apartments in both freehold and
non-freehold areas, but people choose to live in different areas due to
personal preferences such as proximity to work and cultural reasons.
"The non-freehold areas tend to have a more interest for bachelor and
shared accommodation. Freehold areas tend to be leased by newer
arrivals to Dubai," said Giannopoulos.
"It cannot be said that
one area has higher rents than another except that International City
offers the lowest rent of any freehold area. Areas such as Barsha and
Nahda also offer one of the lowest rents for non-freehold" he said.
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