Sharjah’s Rental Landscape Faces Potential Surge in 2024 – Are Tenants Ready?

Sharjah, UAE – The real estate landscape in Sharjah is experiencing a surge in completed residential projects, with newer properties commanding higher rentals. Despite the influx of these developments, tenants in Sharjah are not facing significant rent hikes during renewal, with most increases staying at or below the 5 percent mark.

Post Rent-Freeze Period

Many Sharjah residents who entered into tenancy contracts during 2020 and early 2021 have exited the initial 3-year rent-freeze period. Surprisingly, the anticipated spike in lease rates post this period has not materialized. Landlords, prioritizing renewals, are keen on maintaining stable cash flows, especially amid competition from recently completed projects in sought-after locations like the Academic City district.

Steady Rental Movements

A recent report from property services consultancy Asteco reveals that rental movements in Sharjah have remained within a narrow range throughout the year. The report highlights a 4 percent year-to-date increase in popular residential locations, while newer residential communities and high-rises have experienced sharper rises, averaging around 6 percent. Improved amenities and superior-quality apartments have driven this surge, according to the report.

Potential for Sharper Increases in 2024

Some property market sources suggest that established neighborhoods and apartment buildings in Sharjah might witness more pronounced rent increases in 2024. Mirroring trends in Dubai and Abu Dhabi, Sharjah has been witnessing robust growth in its resident base, filling up older residential buildings, particularly with budget-conscious residents. “By the second half of 2024, rental gains in Sharjah should accelerate,” predicts an estate agent. “Tenants facing renewals or signing new leases may start feeling the pressure, with potential spillover effects in Ajman.”

Current Rental Scenario

The Asteco report outlines the current rental landscape, with 2-bedroom apartments in Al Majaz ranging from Dh20,000 to Dh46,000. In Rolla, average rents span Dh18,000 to Dh26,500, while Al Nahda sees rents between Dh18,000 and Dh35,000. Despite these figures, rent increases in these locations have remained modest, ranging from 1 to 3 percent.

Predicting Future Developments

Explaining the current scenario, an estate agent notes, “Even in new buildings, landlords are not significantly pushing rents higher than the market average. This is why, across residential locations, there haven’t been major rental distortions between new and old tenant leases. However, this status quo might undergo changes in the future.”

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