Average rents in the northern UAE emirate of Sharjah are still 38 per cent cheaper than in 2008, as additional supply keeps rates from increasing rapidly, according to a report from leading real estate consultancy Asteco.

The property market in the Northern Emirates is stable, said Asteco in its UAE Property Review for Q3 2016.

The apartment rents in Sharjah saw minimal changes in the third quarter, down by only one per cent, while the neighbouring emirates of Ajman and Ras Al Khaimah recorded a one per cent rise compared to the previous quarter.

John Stevens, the managing director of Asteco, said: "The stabilisation of the market was a knock-on effect, in part, to rental rates in Dubai also balancing out. As a result there was a minimal number of relocations taking place between Dubai and the Northern Emirates."

New developments in Sharjah attracting investors include Sahara Tower 6 by Al Thuriah, which was announced during Cityscape 2016.

Construction of the residential twin tower project, which will feature 376 residential units, has already started. It is now on sale and due for handover in the fourth quarter of 2019.

On average, new developments in Sharjah range from Dh20,000 to Dh35,000 ($5443 to $9526) for a studio and Dh45,000 to Dh90,000 for a three-bedroom unit.

Rental rates in Al Majaz area range from Dh25,000 to Dh35,000 for a studio, while three-bedroom apartments are available from Dh48,000 to Dh90,000. At Corniche, the prices start from Dh26,000 to Dh35,000 for a studio, while three bedroom apartments span from Dh60,000 to Dh95,000.

Among the northern emirates, Ras Al Khaimah was the star performer, albeit relatively, with a strong tourism and hospitality offering.

"The emirate currently has 3,600 hotel rooms, and its occupancy rate has risen to 71 per cent with more than 40 per cent of guests from the UAE. Furthermore, the RAK Free Zone, popular with many small and medium-sized businesses, has created both residential and office demand," explained Stevens.

Rental rates for newer buildings in RAK range from Dh26,000 to Dh40,000 for a studio and between Dh85,000 to 110,000 for a three-bedroom apartment.

According to Asteco, the rise in Ajman rental rates was mainly due to the addition of better quality supply to its stock while also improving its overall offering to residents in terms of retail and road connectivity.

High-end apartments in Ajman ranged from Dh22,000 to Dh38,000 for a studio while three-bedroom apartments were available between Dh42,000 and Dh72,000, it stated.

On the emirate of Fujairah, Asteco said the rental rates remained stable over the quarter with new supply, such as the Fujairah housing project in Al Taween, which is now 95 per cent completed, expected to be handed over by year end.

Meanwhile the work at Fujairah’s cultural centre has reached 55 per cent completion with handover expected in Q2 2017. Rental rates typically varied from Dh23,000 to Dh28,000 for a studio and Dh45,000 to Dh60,000 for a three bedroom, it stated.

Demand levels for office space in Sharjah remained stagnant over the quarter with limited new supply entering the city, leaving rates unchanged for Q3.

"The retail sector has started developing rapidly in Sharjah and Ajman as population levels support such expansions," remarked Stevens.

"For instance, new food and beverage outlets opened this quarter at the Al Majaz Waterfront and the Corniche areas in Sharjah, whereas the expansion of Ajman City Centre mall to nearly double its current size to 52,000 sq m, is anticipated to complete by the end of Q3 2017," he added.-TradeArabia News Service