Sharjah is witnessing positive sustainable growth across the real estate market with its landlords once again moving to increase the rents and restart stalled projects, according to a report.
However, the handover of new residential stock across the emirate has slowed in the past six months making for a sustainable supply and demand balance, said real estate specialist Cluttons in its Q3 report for Sharjah’s property market.
The rents for sub prime properties have dropped, partly as a result of the new housing regulations aimed at reducing overcrowding in specific areas. However, other residential properties, both villas and apartments, in family areas such as Al Falaj, Ramia and Shargan, have maintained their rental values this year, the report stated.
According to Cluttons, the villa prices are expected to rise over the next six months due to limited new stock coming onto the market thus indicating confidence in the marketplace.
Sharjah’s economy is growing steadily, alongside government initiatives to improve business conditions, attract investment and diversify the local economy. This has proven successful, as it now boasts the highest level of diversification in the region and registered a growth rate of 6 per cent between 2008 and 2010, said the report.
Trade, manufacturing and logistics are some of the best performing sectors in the emirate, which has helped boost the industrial property market this year, said the real estate specialist which has been enjoying a dedicated Middle Eastern presence since 1976.
The industrial sector has seen a rising demand for higher quality, more modern, purpose built premises both from new entrants to the market and companies looking to relocate, Cluttons said in the report.
The demand for office space in 2012 had remained the strongest from small and start-ups with most looking for offices of approximately 2,000 sq ft, it added.
The trend is for businesses to move out of residential properties and explore the increasing range of options provided by purpose-built office towers. In terms of prime office space, the Al Majaz area is topping the list with its high quality offices achieving rents of Dh50 to 90 ($13.6-24.5) per square foot.
Rental values range from Dh16 to 25 per square foot per annum according to location and facilities. Most of the demand is for larger, built-to-suit units in the free zones and in general, the most popular areas are those closest to the Sharjah CBD, the property expert said.
Warehouse rental rates have remained pretty steady at just under Dh25 per square foot per annum since 2010 and are unlikely to change over the next 12 months, it added.
On the 2013 outlook, Cluttons said both rental values and sales prices in Sharjah’s property market, will remain fairly stable throughout the coming months as there is little change in either demand or supply levels.
The one caveat is the residential market which may experience some change in line with the population growth estimates for 2013, but is unlikely to be a significant change, it stated.