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Dubai rents to fall
New report says increase in supply will lead to continuing falls in rent.
May 31, 2010 3:44 by Samuel Potter
A fresh report from CB Richard Ellis says that rents in Dubai are set to fall further this year thanks to an increase in supply, while vacancy rates in Abu Dhabi offices are set to climb to as much as 10 percent next year.
The report expects more than 31,000 new homes to come onto the market this year, 29,000 in 2011 and just under 22,000 in 2012, according to Maktoob.com.
“Increased supply from the residential sector will see a further drop in lease rates. However, the effect would be higher on villas than apartments,” says the report. However, this contrasts to an earlier report from Colliers, which estimated earlier this month that 41,000 homes will be added to the market this year.
Either way, it seems that prices are set to fall further.
“Whether the market has reached the bottom already or is gearing towards stability is yet to be seen,” CBRE said