The cost of buying and renting homes in the northern emirates of Sharjah and Ajman fell by up to 20 per cent in some neighbourhoods in the first half of 2018 as a result of rising supply, according to data from UAE online marketplace Dubizzle said.
“Across the UAE, properties are becoming more affordable resulting in a decline in the cost of living,” said Samer Abdin, general manager at Dubizzle’s property division, on Sunday.
“We are seeing an oversupply of property units in the market right now, which has created a more competitive and affordable market. Apartment sale prices in Ajman in particular have fallen at a more pronounced rate than rental prices, giving property seekers an excellent opportunity to invest in their own property."
UAE property markets have witnessed decreases in both rental and sales prices in the past few years amid a period of low oil prices, which has crimped consumer purchasing power and led to a flight for affordability.
Developers have responded by bringing more low-cost stock to the market, resulting in oversupply in some areas, while landlords are increasingly willing to negotiate with tenants and drop prices rather than have empty units.
Almost all of the key areas of Sharjah and Ajman recorded year-on-year declines in average sales and rental prices in the first six months of 2018, according to Dubizzle’s Northern Emirates property report.
The neighbourhoods of Al Nahda and Al Khan experienced the biggest rental drops, with two-bedroom apartments in Al Nahda declining by 20 per cent year-on-year in the first half, putting the average cost for a two-bed at Dh36,000, the report said.
Al Khan saw an average decrease of 16 per cent while Al Taawun registered an average 14 per cent drop, and Muwailih Commercial dropped 2 per cent on the year-earlier period.
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Sales prices of apartments in Sharjah were more mixed. The most popular Al Khan area (according to Dubizzle website searches) saw a slight increase in average sale price of 4 per cent, while other key areas experienced a drop, with Al Majaz falling by 19 per cent, Al Nahda by 9 per cent and Al Taawun by 4 per cent.
Meanwhile, Ajman witnessed a similar dip in rental and sales prices, with some properties falling at a greater rate than Sharjah, Dubizzle said. Al Jurf and Ajman industrial area saw the largest annual decline in rents in the first six months of 2018, at 18 per cent. Al Sawan followed with a 14 per cent decrease and Emirates City dropped by 10 per cent over the period.
Apartments in Al Nuaimiya saw the biggest drop in average sales prices, at 23 per cent, according to the report, followed by Emirates City (21 per cent) and Al Mushairef (19 per cent).
“While these areas experience heavy declines, Al Sawan experienced the lowest drop in average sale price, of 10 per cent,” Dubizzle said.